For ages we've all known that the U.S. health insurance system works splendidly for those who have good employer-provided coverage, slide smoothly into Medicare when the time comes and seldom get sick. The Affordable Care Act aimed at giving more Americans a shot at that ideal.
Evidence is beginning to trickle in that this seamless pathway for some people who've signed up for Obamacare insurance may be more illusory than real. That may be especially true for some of the 4.8 million people who were newly insured under Medicaid expansion.
A few days ago, an email arrived from the 59-year-old Nebraska woman I reported on last December in a story about her experience shopping for an exchange policy. The woman I'll call Marilyn had done oodles of legwork before selecting a Blue Cross Blue Shield high deductible plan – $6,325 each for her husband and 16-year-old daughter Erin who would be on the plan. (Because of a disability, Marilyn is on Medicare.) The monthly premium after a $141 tax subsidy came to $322.
Not long after the family signed up, Marilyn got a call from Nebraska Medicaid advising that her daughter qualified for Medicaid, which would cover her medical needs starting April 1st. The family took Erin off the Blue Cross policy. That was then. In early June, Medicaid contacted the family requesting proof of income for Erin and her father. Erin submitted pay stubs showing that she had earned $376.50 from two summer jobs that began in late April and will end in August when she goes back to school. That sum disqualified her from Medicaid on June 23rd.
Marilyn was lucky. She got her daughter back on the Blue Cross plan because she said the carrier made a "special accommodation" for her. The premium was a little higher – $369 instead of $322. In the fall, the family will go onto the exchange again and look for a new policy, one they hope has a smaller annual deductible.
In the exuberance of getting so many Americans signed up for Medicaid due to its expansion, we may have forgotten about the Medicaid "churn," the potential for eligibility changes that someone on the program with sporadic income faces during the year. When that happens, families may have to scramble for new coverage and restart the complicated process of getting insurance and understanding it. Being eligible for Medicaid can be highly variable.
In March, a study in Health Affairs looked at rates of churning in each state and "found eligibility changes occurred frequently in all fifty states." Higher-income states and those with more generous eligibility criteria for nonelderly adults before the Affordable Care Act took effect experienced more churning. For me, one statistic popped out. Researchers estimated that even in states with little churning going on, more than 40 percent of adults with either Medicaid or exchange coverage would experience a change in eligibility within 12 months. The Nebraska family was one of them. "Medicaid coverage is an illusion," Marilyn told me. "You think you're covered, but they can kick you off."
Those with exchange coverage could find themselves in the same pickle as Marilyn's family. Just a few weeks ago the Obama administration announced it would be scrutinizing the financial eligibility of some two million of the eight million people who had gained coverage under the federal health exchanges. The government revealed that at least two million people who've received federal tax subsidies may have data discrepancies in their applications that could affect the amount of the subsidy they received.
Obamacare may provide health insurance, but for millions, the ideal of seamless coverage is still a far distant goal.