Harvard Law & Policy Review

Medicaid

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Unhealthy Citizens, Unhealthy Democracy

 By Josh Carpenter*

The United States has two distinct health systems for the poor: generally, one for blue states and one for red states. One system provides health insurance to the disadvantaged through Medicaid expansion. Over 30 states have elected to expand Medicaid through the Affordable Care Act or opted for a modified version. Democrats in statehouses across the country have led this push, although Kentucky and Ohio are important exceptions.  Unfortunately, individuals in 19 states are being denied access to healthcare.

Consequently, the same person could be eligible for insurance in Arkansas, but over the border in Texas, she is uninsured and living in the “Coverage Gap.” This Coverage Gap largely falls along party lines. How did we get here and why does it matter?

In National Federation of Independent Business v. Sebelius (2012) the Supreme Court decided that states should not be mandated to expand their Medicaid eligibility thresholds as outlined by the Affordable Care Act (ACA). The Supreme Court’s decision to decouple Medicaid expansion—which guaranteed healthcare to individuals living below 135% of the Federal Poverty Line—from the remainder of the healthcare law devolved the decision to expand Medicaid to the states, leaving healthcare access for millions of Americans to the discretion of Governors and state legislatures. Many states decided not to expand Medicaid, most of them led by Republicans in the South. Consequently, the law became even more complicated and its impact, unevenly distributed.

When we deny health insurance to the poor, we create several troubling outcomes. Poor people suffer tremendous health disparities. In the Deep South, these disparities are particularly acute along racial and ethnic lines. African Americans, for example, experience disproportionately worse health outcomes than other races.

People without health insurance face significant barriers to accessing care, a problem exacerbated in rural areas with fewer treatment facilities. For example, one in four expectant mothers in rural Alabama receive inadequate prenatal care, contributing to Alabama’s high infant mortality rate. In fact, the average infant mortality rates in Alabama, Mississippi, and Louisiana are so high that they rival that of Botswana.

Denying health insurance to the poor also diminishes a sense of citizenship among the uninsured, stifling their willingness to engage in political participation. My doctoral research investigates the voting behavior of 332,000 Alabamians living in the Coverage Gap. I discovered that less than one-third of these citizens were registered to vote, symptomatic of the difficulties poor people face in registering to vote in Alabama. After conducting a randomized Get-Out-The-Vote field experiment, our intervention found that political mobilization among this population to be a tough sell.

The uninsured Alabamians I interviewed were neither ignorant nor apathetic. They were disconnected. The parameters of extant public policy were drawn to exclude them from receiving public benefits. Indeed, although they conceived of themselves as “outsiders” in electoral politics, they were committed spectators to the policies that those politics generated. Their state—my state—had legislated their social exclusion.

Policy designs have profound effects on subsequent democratic participation, particularly among the poor who live with limited healthcare access. The consistent disengagement of poor, uninsured citizens likely contributes to America’s low voter turnout.

We can and should do better to improve the health of America’s people as well as its democracy.

 

* Josh Carpenter is a DPhil candidate in Politics at Oxford University where he studies on a Rhodes Scholarship. He was the Co-founder and President of Bama Covered, a student-led, grassroots non-profit that informed Alabamians about the Affordable Care Act in 2014.

 

Image by Tomasz Sienicki [user: tsca, mail: tomasz.sienicki at gmail.com] – Own work, Public Domain, https://commons.wikimedia.org/w/index.php?curid=121371

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The Unintended Uninsured: The Affordable Care Act’s Coverage Gap

By Julian Polaris*

This is a golden age for access to healthcare in America. In 2015, over 90% of Americans had health coverage, the highest insurance rate in the 50 years the federal government has collected insurance data. This astonishing progress is due in large part to the Affordable Care Act (ACA): President Obama recently announced that 20 million people are covered thanks to the ACA. The victory is bittersweet, however: had the ACA been implemented as designed, an additional three million people would have insurance today. This is the story of the “coverage gap,” a crack in the ACA created by the Supreme Court and left unrepaired in nineteen states. A crack so wide that three million low-income people have fallen through it.

The ACA, as originally passed, aimed to increase access to health coverage in two main ways. First, the Act expanded Medicaid, the public health plan for people with low income. Previously, most states had limited Medicaid eligibility to specific groups like children and pregnant women. The ACA enlarged and standardized the Medicaid program to cover all people who earn up to 138% of the federal poverty level (FPL). The federal government picks up 90% of the cost of healthcare services for newly eligible beneficiaries, whereas costs in traditional Medicaid are split closer to 50-50.

Second, the ACA established the health insurance “exchanges,” portals in each state where consumers can shop for standardized plans that aren’t tied to a particular employer. Federal tax credits are available to subsidize exchange coverage for those earning 100 to 400% of the FPL.

These overlapping reforms created a seamless continuum of coverage for low-income Americans: everyone earning less than 138% of the federal poverty level is eligible for Medicaid, and subsidized exchange coverage is available to those who earn 100 to 400% FPL.

Then came the Supreme Court’s 2012 decision in NFIB v. Sebelius, best known for upholding the ACA’s central requirement that all Americans secure comprehensive health coverage or pay a penalty. The Court was less conciliatory when it came to the ACA’s Medicaid expansion, however, prohibiting the federal government from instituting a new nationwide eligibility standard and, instead, allowing each state to choose whether or not to expand Medicaid under the ACA’s terms. As of March 2016, 31 states (and DC) have chosen to do so.

Nineteen states have so far rejected the expansion. These states tend to be politically conservative, and their leaders justify non-expansion on familiar conservative grounds related to state budgets, the federal deficit, and distrust in public welfare programs. (See, for example, this explanation from Louisiana’s former governor Bobby Jindal.) President Obama has accused the states of refusing to expand coverage out of “political spite” as much as anything else.

The collateral damage in this ideological crossfire is the three million low-income people who should have health coverage, but don’t. They don’t qualify for their states’ existing Medicaid programs, which exclude childless adults and only cover parents with extremely low incomes (the median income cutoff is 44% of the poverty level, or less than $11,000 for a family of four). Perversely, these same people earn too little to qualify for subsidized coverage on the exchanges: the tax credits only kick in at 100% FPL because everyone below that was intended to be covered by the Medicaid expansion.

The ACA’s access reforms were designed to create a seamless continuum of affordable coverage. Instead, three million people are trapped in the coverage gap, stranded in a regulatory no man’s land between Medicaid and the exchanges.

The coverage gap could be addressed at either the federal or the state level. Congress could amend the ACA to extend the exchange tax credits all the way down the income ladder, but is extremely unlikely to do so. Since the ACA was enacted, Congress has prioritized attempts at repeal over attempts at repair.

This is why all eyes have been on the states. Each state can decide for itself whether to expand its Medicaid program to cover all low-income individuals, and most have already done so. Medicaid expansion allows more individuals to enjoy the benefits of health coverage (which I have previously catalogued here), and also benefits the states in the form of reduced costs and even new state revenue.

The Obama administration has gone to great lengths to make the expansion deal even more attractive for reluctant states. The federal Centers for Medicare & Medicaid Services (CMS) has granted “waivers,” which allow states to modify their Medicaid expansions with Republican-favored policies like beneficiary cost sharing or reliance on private insurance markets. CMS recently announced that the federal government will fund 100% of the costs for most healthcare services received by American Indians and Alaskan Natives who qualify for the state Medicaid program, a particularly powerful incentive in rural states with large Tribal populations. In the President’s 2017 budget proposal, he also extended additional federal funding to holdout states that agree to expand their Medicaid programs now, though Congress is not likely to approve that (or perhaps any) Obama proposal.

In red states that have adopted the expansion, Republican governors emphasize the moral imperative of providing health coverage for low-income people, and point to the billions of federal dollars available to pay for it. So far, however, nineteen states remain unconvinced.

Meanwhile, three million people are stuck in the coverage gap, accounting for a full 10% of America’s remaining uninsured population. Health coverage is a critical support for individual health and financial security, especially for low-income people who are already at higher risk for poor health and may struggle to pay for basic needs. The benefits of affordable and comprehensive coverage ripple out beyond the covered individual to family and friends, employers, and public institutions. Here’s hoping we can bridge the gap and restore the ACA’s promise of affordable coverage for all Americans.

 

* Julian Polaris is a recent Yale Law School graduate and an Associate in the Healthcare Division at Manatt, Phelps & Phillips, LLP, where he advises state governments, providers, and private payers on healthcare regulatory matters. This post was written in his personal capacity.