Two in five adults who were uninsured at some point in the past two years and live in states that opted not to expand their Medicaid enrollment under President Obama’s health care overhaul will not be able to take advantage of new coverage options under the sweeping law, according to a new study.
The Commonwealth Fund says this is because the Supreme Court allowed states to opt not to expand the federal-state entitlement to those making up to 133 percent of the federal poverty level without risking existing federal funds for the program.
So far, fewer than half of the states have decided to expand Medicaid within their borders next year.
The Commonwealth study says that puts some low-income residents in a pickle in the 22 states that have decided not to expand and the four states that are still mulling their options.
The Affordable Care Act established government subsidies to defray the cost of private insurance among those making between 100 percent and 400 percent of the federal poverty level. Americans can begin to enroll in state-based exchanges on Oct. 1 to take advantage of coverage and subsidies that begin next year.
“However, there are no new subsidized insurance options for families with incomes below the poverty level because lawmakers assumed they would be eligible for the Medicaid expansion; they did not anticipate the Supreme Court decision,” the Commonwealth Fund said.
There is no deadline for states to expand Medicaid. They may opt in or out on a quarterly basis.
While state officials consider the issue, the Commonwealth Fund’s research said Congress could craft a solution that allows residents who earn less than the federal poverty level yet are not eligible for Medicaid to obtain government subsides on the state exchanges.
“This would ensure that all Americans have access to the law’s sweeping new reforms when they take effect in January,” the researchers said.
Some Republican governors, despite their distaste for Obamacare, have pushed their state legislatures to expand Medicaid, citing its economic and social benefits. The federal government will pick up 100 percent of the tab for the expanded population in 2014-2016, before scaling back its contribution to 90 percent in 2020 and beyond.
Yet conservatives such as Texas Gov. Rick Perry are skeptical that Washington will live up to its promises, and they warn that a health program they view as broken will bust their state budgets down the road.
Critics of Obamacare say the law is flawed and imposes too many burdens on Americans, businesses and the federal budget. Advocates of expansion say those declining federal funds to help poorer residents gain health insurance is mean-spirited and missing out on a good deal for state coffers.
Former President Bill Clinton, who promoted the health care law in a speech Wednesday, criticized states that have opted not to expand Medicaid and, as a consequence, left people in the lurch because they are “too poor” to gain benefits.
“Not too rich, too poor,” he said. “And this is a serious problem.”