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Wednesday, September 19, 2012

Supreme Court Ruling and Medicaid Changes-Impact on the "47%"

Supreme Court Ruling on Health Care Reform-Impact on the 47%

Presidential Candidate,  Mitt Romney has identified the 47% of the country’s population which he doesn’t care about and this article addresses how the Supreme Court rulings on the Patient Protection and Affordable Care Act will impact “their” access to Medicaid and subsidized health care through the insurance exchanges in 2012. This article will also inform health care administrators in various government and nonprofit agencies who will be implementing the law. Additionally, business owners should have an understanding of the eligibility rules for the subsidized insurance plans, as, unbeknownst to Mr. Romney; people in the “47%” can actually have jobs and not have any health insurance. So, to all of you people out there who are working either part-time or full-time or unemployed, read on to learn what your options will be in 2014, assuming the health care reforms are not dismantled.

Supreme Court Ruling on Health Care Reform
Though the Supreme Court indicated the federal government could not use its bully pulpit and reduce federal government Medicaid payments to states which chose not to comply with the health care reforms for Medicaid, the government is allowed to implement the sweeping health care reforms. This means the requirement to purchase insurance stands, along with the scheduled subsidies for individuals to be able to purchase medical insurance and so does the government’s ability to tax individuals (and corporations) who opt not comply. So for those of you who think the health care changes are not going to happen, you better get busy on the implementation.

Affordable Care Act Impact on Medicaid Programs
Under the Patient Protection and Affordable Care Act, there are a number of changes to Medicaid, the jointly run federal and state program for the significant population of poor people living in the United States. Presently under the Medicaid program, low-income single people are not eligible for the program unless they are disabled. Under the rules change, low-income people, earning 133% of the federal poverty level, which is $11,170 for a single individual[1], could have an income of $14,856 and still qualify for Medicaid Insurance.  Also, people who are working full-time and only earning minimum wage, in states which do not have minimum-working-wages may only earn $11,000 a year, working at $5.50 an hour.

Impact on the Working Poor
Under the health care reforms, states can choose how far they want to go to participate in the revised Medicaid eligibility standards, in other words, to fully offer the program to all of their eligible poor residents (who must be citizens by the way). A quick way to gauge the impact of the Medicaid expansion for each state is to look at Department of Labor information for states lacking any minimum wage criteria and thus are likely to have a higher degree of individuals who are classified as the working poor.[2]  In this category are: Alabama, Louisiana, Mississippi, South Carolina, and Tennessee. To further underscore that point, these states actually have a minimum wage standard which is lower than the federal benchmark of $7.25 per hour are: Arkansas, Georgia, Minnesota, and Wyoming. A high five to all of the states who at least meet the federal wage standard and a special mention for the following states who have minimum wage guidelines higher than the federal mandate: Alaska, Arizona, California, Colorado, District of Columbia, Connecticut, Florida, Illinois, Maine, Massachusetts, Michigan, Ohio, Oregon, Nebraska, New Mexico, Rhode Island, Vermont, and Washington. The latter states perform their own economic analysis and arrive at a wage that theoretically is a “living wage” for a full-time employee.
Though there are federal inducements to cover the newly eligible Medicaid population, it remains to be seen which of these states will agree to implement the program, because after all they will have to contribute to the cost of it. For example, someone working full-time at the federal minimum wage and living in Texas would make $14,500 a year, which would qualify that individual for state Medicaid insurance based on the threshold of 133% of Federal Poverty Limits for 2012. I am betting there are quite a few individuals in that category in the Lone Star State.

Changes to the Qualifying Criteria for Medicaid
The income calculation to determine whether or not someone qualifies for state Medicaid will be vetted using electronic income verification via your social security number and also include a personal declaration for those who lack regular employment, such as those who perform any-odd- job they can find in this economy. To Mr. Romney these are your bottom 47% but to the rest of us working stiffs, these are the people who mow your lawns, take care of your children, serve you lunch, and answer the phones in a myriad of locations. You would be surprised who is working for minimum wage or barely more than that. There is such a stigma in this country for earning a low wage people are reluctant to speak up, but if you are extremely wealthy by accident of your birth you can bellow all you want.

Under the Modified Adjusted Gross Income (MAGI) Medicaid criteria there is no longer an asset limit to qualify for Medicaid, so for example, one could own a home and qualify. Increasingly in my fundraising work I speak with senior citizens who qualify for federal poverty status, because all of their investments have dried up and they get minimal interest on any cash reserves that have left. Though they may have a dwelling, this does not make them wealthy and typically they even convey that back to the ever handy bankers with a reverse mortgage. Additionally, the income criteria may be reviewed for re-certification annually.  And finally, the members of the household who are included in the income qualification standards are the same as those for federal income tax filings.[3]

Children within 200% of the federal poverty level are eligible for Medicaid, which is the same standard as the CHIP or Children’s Health Insurance Plan, which has been around for years and is highly successful.

Pregnant women are eligible for Medicaid if their income is within 185% of the federal poverty rate and this is also the standard most states already use.

There are some new eligibility inclusions for families who are taking care of parents and caretakers of other relatives as well.

Categorically Eligible Medicaid Patients Unaffected by the Reforms
If you are unfortunate enough to be blind or disabled the health care reforms for Medicaid do not change your status, because you are already eligible regardless of being single and lacking children. Foster children will experience no change in their Medicaid eligibility either. And finally, those covered on Social Security (dual eligible patients for both Medicare and Medicaid) are also unchanged by the Medicaid updates.

Unintended Consequences
Though it is a good idea to find a way to expand the social safety net through improving health care access by increasing some level of payment to hospitals and clinics, this legislation doesn’t address the unreasonably low reimbursement for physicians who are expected to treat all of these new patients. The Medical Home legislation and some of the Centers for Medicare and Medicaid demonstration projects are investigating methods to improve the primary care treatment dichotomy, but the results are not available yet. Conclusion, many states will be reluctant to increase their Medicaid budget, which must be funded by sales or income taxes from state residents.

As one of the part-time workers who is in the bottom 47% by virtue of the fact I have not earned more than $20,000 a year since the 2007 regulatory failure which resulted in the economic meltdown, I guess this makes me less important to Mr. Romney and his cronies, but I can tell you this, the only magic underwear I believe in are those you buy at the department store.
And this is the healthpolicymaven signing off.
This article may be reprinted with the permission of Roberta E. Winter, MHA, MPA or preferably, share it virally without her permission.



James Allen said...
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Thumbs up for these insurance clarification, by the way, do you have PDF copies of these articles?

healthpolicymaven said...

To share information the most expeditious way is to simply forward the link. PDF's are considered printed copies and are not offered. If quoting from the article just be sure to cite the article, the print date, and the author.