A $6,000 deductible isn’ t much help if you’ re earning $12,000 a year.
Over the past several years, health care for the American poor has become a curious patchwork where most blue and purple states expanded Medicaid but the solidly red ones — especially in the South — generally did not. When congressional Democrats drafted the Affordable Care Act back in 2009 and 2010, they took it for granted that all states would accept federal funding to expand their Medicaid programs. But then the Supreme Court ruled that a key element of the law, which essentially forced states to do that, was unconstitutional. This created a weird and unenvisioned gap in the law’s coverage provisions. If your income is slightly too high to qualify for Medicaid, you receive a pretty generous subsidy to buy health insurance on your state’s exchange. But if you are just below the threshold and you live in a state like Texas or Florida that hasn’ t expanded Medicaid, then you get nothing at all. The Senate’s health bill, while drastically cutting Medicaid, does address this “Medicaid gap” issue by making subsidies available all the way down the income chain. Texas-based journalist Erica Grieder argues this makes the bill a good deal for low-income people in those states. The reality is not so clear., “despite being eligible for premium tax credits, few low-income people would purchase any plan, ” because the plans available are essentially useless to the poor. Many patients using ACA exchange plans complained that they had deductibles so high that the insurance was hardly worth using. The law did, however, attempt to address that by offering special additional subsidies to limit out-of-pocket costs to the lowest-income patients. It also required insurance companies to cover preventive medicine with no copayment or deductible. The Senate bill changes all of this, and creates a situation where even with subsidy, a typical person poor enough to qualify for Medicaid is probably off buying insurance. Under Obamacare, tax credits were tethered to the cost of plans covering 70 percent of medical expenses. The Better Care Reconciliation Act would reduce that amount to plans that cover 58 percent — meaning higher copayments and deductibles. It also allows states to waive out of the “essential health benefits” requirements that cover preventative care and other things. Many states, of course, won’ t waive those requirements. But since we’ re talking about non-expansion states, we are already specifically talking about the states with the most rigorously conservative politicians, so they probably will waive them. The result is that you’ re talking about plans that likely won’ t cover any services without cost sharing, and whose deductibles are likely to be in the range of $6,000 or more. The people currently ineligible for subsidies are people earning 100 percent of the federal poverty level or less. For a single individual, that means less than $12,060 a year. Even if the subsidized cost of your premium was low, it’s difficult to see what the actual value of a plan with a deductible that high would be. You’ re going to end up indigent and relying on emergency room care well before you hit that level. Of course, it’s possible in theory to have very low income and also have $15,000 stashed away in the bank. But according to the had a median net worth of $50 back in 2013. When the data is updated later this year, it will probably show a modest increase. But outside of a handful of weird edge cases, there’s just no way people with incomes below 100 percent of the poverty line can afford to use the kind of high-deductible plans the BCRA envisions.
