Commentary

Debunking Medicaid expansion misperceptions

Despite reports from states that Medicaid expansion has had health and fiscal benefits, North Carolina remains in the minority along with 18 other states that have failed to close the coverage gap. Unfortunately, there is still a sentiment that people have to prove that they are deserving of health care coverage, instead of noting how increased access to health care and utilizing health services has positive effects ranging from school achievement to job production. The 2016 Child Health Report also highlights how parental coverage is directly connected to whether children have access to and utilize health care services .

Those who object to expanding Medicaid fail to report that many individuals in the coverage gap are working, but may not work enough hours to qualify for employer-sponsored health insurance. Further, many working adults in the coverage gap have low wage jobs and thus make too little to receive financial assistance to purchase health coverage through the Marketplace. As a family of four in the coverage gap has an income of $33,534, it does not seem that Large Health Savings Accounts (HSAs) are a viable option for families that have other financial priorities.

Failing to expand Medicaid will not only continue to increase health disparities among individuals and families, but also entire communities. The longer policymakers take to close the coverage gap, the more it impacts rural communities’ ability to provide affordable and quality health services. According to the Hospital Strength Index, there are 16 vulnerable rural hospitals in North Carolina. If these hospitals were to close, there would be over 300,000 fewer patient encounters and over 3,000 health care related jobs would be lost. Considering that nearly 30 counties in North Carolina lack primary care providers such as Ob-Gyns, the gap in availability of health services could increase further.

Opponents of closing the coverage gap also cite concerns that individuals that currently obtain financial assistance to purchase health insurance through the Marketplace will shift to “inferior” Medicaid coverage if North Carolina expands Medicaid. However, a report by The Commonwealth Fund, states that Medicaid beneficiaries receive preventative care at the same rate as those with private health insurance. Medicaid enrollees also reported similar rates of satisfaction with their health care experience as the privately insured. What’s more, Medicaid beneficiaries report having medical debt at lower rates than the privately insured. Along with the misperception that people will receive “inferior” care, there is concern there will be increased burden to individuals and families with private insurance through cost-shifting. Overall, Medicaid spending growth is less than private insurance. Additionally, as payment for private insurance and Medicaid services shift from fee-for-service to global payment models, cost-shifting to private insurance beneficiaries is unlikely. Considering that Medicaid reform is transforming to a full risk capitation payment model, this is even less of a concern in North Carolina. Now that North Carolina’s Medicaid program is entering a new phase, it is time to extend Medicaid coverage to 500,000 people in the coverage gap.

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NC Blue Cross Affordable Care Act premiums announced today in line with other states: “lower than expected”

bluecrossblueshield.jpgToday NC Blue Cross announced the range of premiums for different plans that it will be offering in NC’s new federal health care marketplace.  These are premiums for comprehensive health plans with no lifetime or annual limits, no extra charges for pre-exisiting health conditions or being a woman, and with comprehensive coverage of everything from prescription drugs to having a baby. In short, real quality health coverage.

The NC Blue Cross “sticker price” premiums are in line with the “lower than expected” premiums announced in other states for their health marketplaces when I compare them to the premiums listed in a Kaiser Family Foundation study looking at 18 other states that came out today.

Remember that the “sticker price” premiums NC Blue Cross announced today and in other states are reduced significantly by federal tax credits available in the health marketplace to many middle and lower income people.  For example, a family of four making less than $88,000 a year will qualify for some tax credit.  As NC Blue Cross notes in its press release, for some of the very lowest income people, premiums can be as low as $19 a month. Or, for example, a single person making $25,000 a year can buy a health plan for $97 a month or less.

Two quick points:  First, Even though premiums are OK in NC, I will note that in states that have set up their own health care marketplaces there are significantly more health plans participating and more competition.  For example, Maryland has at least six plans to our two.  Second, if NC were to expand Medicaid, it is clear that we all would have lower premiums since we would be covering the care of people we now all pay for in tacked on charges to our premiums because of the uncompensated care someone who is uninsured receives.