The Affordable Care Act seems to be the law with nine lives.
It survived a challenge to the constitutionality of the individual insurance mandate. It has survived despite more than 50 votes in the House of Representatives to repeal significant portions or all of the law. And now it survived its latest assault when the Supreme Court ruled that lower-income people in all states can receive health insurance subsidies under the law, regardless of whether the state or federal government runs the state’s health insurance marketplace. The law also probably would survive a Republican White House in 2017.
In short, Obamacare is here to stay. So what now?
Many Texas lawmakers have doggedly opposed all aspects of Obamacare since its passage five years ago, perhaps hoping the law would simply go away. But now it is time for the law’s opponents to take a more pragmatic approach and embrace those parts of the law that can help ordinary Texans afford needed medical care.
In particular, Texas should take advantage of generous federal matching funds available to states that expand their Medicaid programs to cover people earning up to 138% of the federal poverty level, or $33,465 for a family of four.
The recent Supreme Court decision, King v. Burwell, ensured that people earning more than 100% of the federal poverty level could afford to purchase health insurance. However, there are more than one million Texans who earn less than 100% of the poverty level but are ineligible for the state’s Medicaid program. These people in the so-called Medicaid gap have little choice but to remain uninsured and stay subject to high risk of bankruptcy when faced with major medical expenses.
Take, for example, “Mary,” a 60-year-old woman who is only able to work on a part-time basis because of physical disabilities and other medical issues. Her income from her part-time job is not enough to meet the $11,670 threshold for a single person, and she isn’t able to do additional work to increase her income. She needs health insurance to address her medical needs, have a better quality of life and possibly be able to work more hours and earn more. Unfortunately, there is no affordable insurance option available to her. She is stuck in the Medicaid gap.
It is unfair that people in this situation receive no help paying for insurance, whereas a similar person earning a few thousand dollars more per year would receive generous subsidies to purchase coverage on the health insurance marketplace.
And beyond being unfair, Texas’ failure to expand Medicaid represents bad state fiscal and economic policy. A report prepared for Methodist Healthcare Ministries showed that the state could pay for its roughly 10% share of Medicaid expansion costs by cutting other safety net programs that would no longer be needed. Furthermore, the additional federal Medicaid spending would provide meaningful stimulus to the state’s economy.
Whether you love or hate Obamacare, it is time to accept that the law is not going away. Rather than simply opposing all things Obamacare, our Texas lawmakers should respond appropriately to the new incentives that the law introduces. Most important of these incentives is the extremely generous federal match for Medicaid expansion. Failing to expand Medicaid is bad for people such as Mary who fall in the gap, and it is bad for the state’s finances and the state’s economy. Quite simply, it is bad policy.
*Featured/top image: A physician talks with a patient at the Cancer Therapy and Research Center. Courtesy photo.