The Center's work on 'Health Policy' Issues

The Center works to ensure that federal and state health insurance programs provide coverage that meets the health care needs of low-income children and families, as well as seniors and people with disabilities. The Center also works to remove barriers preventing eligible families from gaining access to health coverage.


Auto-Renewal Not the Best Option for Enrollees in Federal Insurance Marketplace

November 21, 2014 at 2:08 pm

People who bought private health insurance last year through the federally run marketplace could pay more than they should next year unless they return to the marketplace to renew coverage, our new paper explains.

That’s because they will be automatically re-enrolled in the same plan in 2015, with the same subsidies to help pay for coverage, unless they choose a plan through the marketplace during the open enrollment season, which began November 15.

The federal marketplace, which operates in the 34 states that don’t have a state-based marketplace (see map), provides auto-renewal as a backstop to ensure that people who don’t return to the marketplace don’t lose coverage.  But auto-renewal won’t account for factors that affect the level of people’s subsidies and can change from year to year, such as a household’s size or income and premiums for health coverage.  As a result, many people who auto-renew will receive subsidies that don’t reflect what they’re eligible for.

The only way for consumers to ensure they receive the correct level of benefits is to provide updated information to the marketplace and have their eligibility re-determined.

Renew CHIP — And Sustain Children’s Health Coverage Gains

November 14, 2014 at 3:11 pm

The share of children without health insurance remained at a historic low of 7.1 percent in 2013, Georgetown University Center for Children and Families’ annual report on children’s health coverage finds (see graph).   That’s down considerably from the 9.3-percent rate for 2008, the earliest year for which we have comparable data.  (The small change from 2012’s 7.2-percent rate wasn’t statistically significant.)

Along with Medicaid, the Children’s Health Insurance Program (CHIP) has been a major factor in reducing the ranks of uninsured children since its enactment in 1997.  However, states will get no new federal CHIP funding after September 2015 unless Congress acts.

And without new CHIP funding, as many as 2 million children could lose health coverage and become uninsured, the Government Accountability Office (GAO) estimates.

Congress should act as soon as possible to extend federal CHIP funding.  Otherwise, it risks derailing these substantial gains in children’s health coverage.

Low-Income Adults Favor Medicaid Expansion, New Survey Shows

November 13, 2014 at 4:06 pm

Four-fifths of low-income adults surveyed in three southern states favor health reform’s Medicaid expansion, a new Harvard School of Public Health study finds.  The first quantitative analysis of potential enrollees’ views on Medicaid, the survey included residents of Kentucky (which has adopted the expansion), Texas (which hasn’t), and Arkansas (which has expanded under a waiver that allows it to enroll the expansion population in private marketplace coverage).

The survey was conducted in December 2013, during health reform’s first open enrollment period (and before implementation of the Medicaid expansion), to maximize the likelihood that respondents were familiar with the concepts in the survey.

Large majorities of respondents also said they believe that Medicaid’s quality of care, access to physicians, and affordability rival or outperform private coverage.

Roughly two of every three uninsured low-income adults surveyed in each state planned to apply either for Medicaid or subsidized marketplace coverage, the survey also found.

State policymakers should take into account this strong support for Medicaid among low-income adults as they debate whether to take up the expansion.  Twenty-three states (including Texas) haven’t expanded Medicaid.  In addition, Arkansas’ private-option expansion may not get the funding needed to continue, despite covering some 200,000 low-income Arkansans.

While the Harvard survey found that low-income adults value Medicaid highly and would enroll if eligible, it also found that many residents didn’t know whether their state has adopted the expansion.  So, achieving the full benefits of the expansion will require not just convincing more states to adopt it but also making more low-income eligible adults aware of it so they enroll.

Attack on “Risk Corridor” Program Falls Apart

November 13, 2014 at 12:32 pm

Congressional Republicans this fall may seek to repeal or block health reform’s temporary “risk corridor” program, designed to help cover any higher-than-expected costs for insurers that offer plans in the new marketplaces while sharing in the savings if costs are lower than expected.  They’ll likely make misleading claims about the risk corridors like those from Senator Marco Rubio and other Senate Republicans in a recent letter to House Speaker John Boehner.  These attacks simply don’t hold up under scrutiny.  Contrary to the Rubio letter:

  • The Administration has full authority to make risk corridor payments. The Rubio letter, citing a Government Accountability Office (GAO) legal opinion, claims that the Administration would violate the Constitution if it makes any risk corridor payments to insurers because it lacks the authority to do so.  But as we recently noted, the GAO opinion actually says the opposite.  Agreeing with the Administration, the GAO finds that the Centers for Medicare and Medicaid Services (CMS), which administers the risk corridors, has the authority to use contributions from insurers with lower-than-expected costs to finance payments to insurers with higher-than-expected costs.  In fact, GAO finds that CMS has the authority to use its regular operating funds to finance risk corridor payments as well.
  • The risk corridor program will be budget neutral. The Rubio letter says that the risk corridor program will put taxpayers at risk if insurers systematically face higher-than-expected costs, which could cause risk corridor payments to exceed contributions.  But the Administration has already issued regulations and guidance ensuring that the program will be budget neutral to the federal government over its three-year existence.

The Rubio letter also fails to mention that repealing or blocking the risk corridor program would result in higher premiums for marketplace plans.  That’s because the program helps keep premiums affordable by reducing uncertainty for insurers.  

Health reform’s major reforms to the poorly functioning individual insurance market (like prohibiting insurers from charging higher premiums to people in poorer health or excluding them entirely) and the launch of its new marketplaces have temporarily raised insurers’ uncertainty in pricing their premiums during the marketplaces’ first few years.  If Congress blocked the risk corridors, insurers would have to build a bigger “risk premium” into their premiums for 2016, making coverage less affordable.  (Insurers have already finalized their 2015 rates.)  And some insurers might decide not to participate in the marketplaces in 2016.

If Congress enacts legislation denying the Administration the authority to make risk corridor payments, that would be virtually certain to drive up the cost of health insurance provided through the marketplaces.

Veterans and the Safety Net

November 11, 2014 at 1:01 pm

Veterans’ Day is an appropriate time to highlight some ways that the safety net helps many low-income veterans and active-duty members of the military make ends meet.  It’s important to note that policymakers’ actions in areas like health coverage and tax credits for working families have a big impact on veterans and their families.

SNAP (formerly food stamps):  Roughly 1.7 million veterans live in households that participate in SNAP at some point during the year, and roughly 980,000 live in households that participate in an average month.  SNAP provides an essential support for low-income veterans, who may be unemployed, working in low-wage jobs, or disabled.  Click here for more.

Housing assistance:  Roughly 343,000 veterans — most of them elderly or with disabilities — receive rental assistance to help them afford housing.  Rental assistance appears to have played a central role in the 33 percent decline in veterans’ homelessness since 2010 (see graph), and it allows veterans to devote more of their limited resources to other basic needs, like food or medicine.  Click here and here for more.

Health coverage:  Roughly 215,000 veterans in 23 states are uninsured and denied Medicaid because their state has refused to take up health reform’s Medicaid expansion.  Their income is too high for Medicaid under prior eligibility rules but too low to receive subsidies to buy private coverage through the new insurance marketplaces.  Click here for more.

Working-family tax credits:  Many families that include one or more veterans or active-duty military would lose all or part of two federal tax credits if key provisions expire as scheduled at the end of 2017.  Some 450,000 veteran and armed forces families with children would lose all or part of their Child Tax Credit; a similar number of veteran or active-duty military families would lose all or part of their Earned Income Tax Credit.  Click here for more.