Five years after Obamacare became law, one big cohort of people still have no health care coverage, but its not because they choose not to signup. They fell through the cracks and didn’t have the option.
America has four million people who fall into the Medicaid coverage gap. Of those, six in 10 live in four states: Texas, Florida, North Carolina, and Georgia, and nine in 10 live in the South, according to Robin Rudowitz, associate director for the Kaiser Commission on Medicaid and the Uninsured (KCMU).
One of the unintended consequences after the Affordable Care Act rollout was the Medicaid gap. As the ACA was written, Medicaid would have expanded. Originally meant only for poor children, seniors, and disabled people, Medicaid’s premium-free health insurance was to cover more people, including adults with a household income up to 128 percent of the poverty line.
When the Supreme Court ruled that states could not be forced to accept the Medicaid expansion, nearly half opted out. The people who would have been covered by an expanded Medicaid were not eligible for any premium subsidy, and many of those are going without health insurance.
The original plan was that federal dollars would pay for the expansion 100 percent, then gradually lower the match to 90 percent, still much higher than the previous federal-state match. It could be described as free money, but some governors and legislatures did not trust the offer, concerned that costs would eventually be too big a burden for the states.
Most of those governors were in the South, like Georgia Gov. Nathan Deal.
“If you think your taxes went up a lot this month, just wait till we have to pay for “free health care.” Free never cost so much,” said Deal said in a January 2013 speech.
He said Georgia already spends $2.5 billion on health care. “As I have indicated, I have rejected the Medicaid expansion in Georgia already, but let me emphasize that the expansion would have put our additional costs over 10 years closer to $4.5 billion—and that’s operating under the dubious assumption that the federal government, with its ever-growing national debt, would have fulfilled their promised share.”
He said once more people joined Medicaid, the state’s costs would have risen unsustainably. Even without the expansion, according to Deal, 100,000 Georgians were eligible but had not joined Medicaid. Adding even more would have strained the state’s budget, in his analysis. They would be motivated to sign up once the individual mandate started, and thus would cost the state more.
Georgia’s legislature later passed a bill that took away the governor’s power to authorize a Medicaid expansion.
A number of other states are still considering whether to expand Medicaid. They can decide to expand Medicaid at any time, but the federal government will only pay 100 percent for three calendar years, until Dec. 31, 2016. If the states expand Medicaid after that, they will be stuck with the 90 percent match set in the law.
“It would take an act of Congress to change that matching rate,” said Laura Snyder, senior policy analyst with KCMU.