• What happens if a state refuses to expand Medicaid? Ctd.

    John Graves, Assistant Professor at Vanderbilt University School of Medicine, writes me about my prior post,

    Just wanted to touch base briefly on the Medicaid ruling and your post from today.  […] What Jared B. says is basically true.  But it’s actually folks <100% (not <133% FPL) that are ineligible for exchange subsidies.  The ACA allows for a small sliver of folks between 100-133% FPL, who AREN’T eligible for Medicaid, to claim the exchange premium tax credit (and for them, the credit caps their contribution to the premium at 2% of income).   So if a state decides to opt out of the expansion, that leaves folks under 100% likely exempt from the mandate, but with no access to federal subsidies.

    Interestingly, this point was key in the constitutional challenge of the Medicaid expansion.  Since the exchange premium tax credit schedule begins at 100% FPL and not 0% FPL, it was argued, the ACA basically assumes that states will keep their Medicaid programs to cover folks under the poverty line.  This, they argued, is coercion.  Jim Blumstein, my colleague here at Vanderbilt, has written extensively on this — both in a NEJM perspectives piece last fall, and in an Amicus brief filed in the Florida challenge against the ACA.

    Here’s the NEJM piece (see bottom of 2nd paragraph) and here’s the amicus brief (pdf, see top of page 16).

    @afrakt

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    • Existing Medicaid minimum coverage will still stand – children under age 6 and pregnant women can still get covered with incomes < 133% of FPL and children 6-10 at less than 100% – plus several states have waivers that extend coverage to parents and even childless adults. The biggest losers will be those adults without dependent coverage under 100% of FPL – currently about $11,000 for a family of one. For states that don't expand and don't have existing programs, there are no subsidies.

    • PPACA states that premium subsidies of 2% are available to those <133%FPL (p. 106 of the consolidated print). The cost-sharing subsidies are the ones that start at 100% FPL. So is there actually a coverage gap without subsidies? Seems that those individuals <133% (actually, at any income level up to 400%FPL) but above income levels of a Medicaid plan in a state that rejects the ACA expansions will still have access to subsidies on the exchange….right?

      Do any state Medicaid plans not offer coverage for an individual <100%FPL?

      • To your final question, yes. There are many states that do not cover everyone with an FPL below 100%. I will investigate the issues raised in your first paragraph.

        UPDATE: See 124 Stat. 214 where it says regarding premium assistance:

        (ii) SPECIAL RULE FOR TAXPAYERS UNDER 133 PERCENT OF POVERTY LINE.—If a taxpayer’s household income for the taxable year is in excess of 100 percent, but not more than 133 percent, of the poverty line for a family of the size involved, the taxpayer’s applicable percentage shall be 2 percent.

      • can people with income below 100% fplclaim the premium credit ????

    • Lynn, I believe that for childless, poor adults, MOST states don’t offer Medicaid coverage at any income level. You generally have to be a parent. Here’s State Health Facts’ chart on low-income adults’ eligiblity for Medicaid (it’s run by the Kaiser Family Foundation):

      http://statehealthfacts.org/comparereport.jsp?rep=54&cat=4

      By my count, for low-income childless adults, only 8 states offer full Medicaid coverage (and 2 have closed enrollment). A further 17 offer coverage that’s more limited than Medicaid, usually something like a bare bones plan.

      Does anyone want to take bets on who will a) try to refuse the Medicaid expansion and b) successfully refuse it? I bet Texas and Mississippi.

      • a childless adult has income less than100% fpl but they have a grandfathered plan. does anyone know what they would need to do?????

    • This is important and another question assoc that you allude to is whether or not the mandate penalty will apply;

      The individual mandate applies to all these people, however the penalty is not applicable in the following cases – which would practically encompass all those below 100% FPL:

      1. If an individual is below the tax filing threshold.

      · The tax filing threshold for an individual in 2011 was $9,500 and for a couple was $19,000.

      · The 2012 HHS Federal Poverty Level for an individual at 100%FPL is $11,170 and for a couple is $15,130.

      · So you can see it means most would not have to pay the penalty.

      2. If the cost of a bronze plan would be more than 8% of an individual’s household income. An individual’s household income for those not already exempted by the above condition includes those individuals between $9,500 and $11,170. The premium would have to be really cheap, like $800 a year which in unlikely so will also therefore also offer an exemption

    • how to fix this problem, chance the law were everyone between 0%-150% fpl can purchase private insurance with a actuarial of 94% and claim the premium credit.

    • some people are going to qualify for medicaid based on their 2013 income and find out in 2015 that their 2014 income was out of medicaid range.