Repeal of the Affordable Care Act will leave fewer people in Iowa with insurance than before the law took effect.
Editor’s Note: The Iowa House of Representatives voted Monday to deny the ability of lawmakers to use visual aids in debate on the floor. To help Iowans visualize what kinds of graphics might be useful in these debates to illustrate facts, we will offer examples. Here is today’s graphic, to illustrate what could be expected to happen in Iowa if Congress repeals the Affordable Care Act.
Repealing the Affordable Care Act (ACA) without an adequate replacement, as Congress and the incoming Trump administration appear poised to do, jeopardizes the health care coverage and economic well-being of the most vulnerable Iowans. About 230,000 fewer Iowans would have health coverage in 2019 if the law is repealed, including 25,000 children.
In fact, repeal of the ACA could leave tens of thousands of adults uninsured who actually had insurance prior to the ACA. Some 69,000 Iowans covered by an Iowa program, IowaCare, became part of the Iowa Health and Wellness Program with the advent of the ACA, while even more Iowans had insurance with the help of ACA subsidies.
Repeal leaves all three of those programs gone — IowaCare, Iowa Health and Wellness, and the ACA subsidies. Thus, fewer will have insurance than in 2013, prior to the ACA, and low-income Iowans will be worse off. This is an issue that state legislators may be left to address with no help from the U.S. Congress, but is not getting attention at the Iowa Statehouse.
For more information, see this Iowa Fiscal Partnership policy brief by Iowa Policy Project Research Director Peter Fisher.
A new report from the Economic Policy Institute traces the erosion of job-based health coverage across the last decade — and the slowing of that decline in the last year. Nationally, as EPI Director of Health Policy Research Elise Gould underscores, job-based health coverage has shed almost 14 million non-elderly Americans since 2000. But slow improvement in the national economy over the last year, coupled with key components of the Affordable Care Act (most notably the provision that young adults are allowed to stay on or join their parents health insurance policies) have slowed those losses since 2011.
The other important trend across this decade is the dramatic growth in public health insurance. Medicaid and CHIP (hawk-i in Iowa) have picked up coverage for at least some of those who have lost job-based coverage. While losses (2000 to 2012) in employer-sponsored insurance were greater among children than among non-elderly adults, for example, the share of children without any coverage actually fell 1.8 percentage points.
Much the same pattern has played out in Iowa. In 2000-2001, Iowa’s rate of job-based coverage for those under the age of 65 was 76.9 percent — one of the highest rates in the nation; by 2011-2012, that had fallen to 64.5 percent — closer to the middle of the pack among states.
As the graphic below shows (Iowa is the red dot), this was one of the steepest rates of loss in the nation (coverage down 12.4 percent) and represented a net loss in job-based coverage of over 200,000 non-elderly Iowans. Of those losing coverage, about half (97,075) were working-age adults and about half (111,839) were kids (indeed, the share of kids losing job-based coverage in Iowa, at 16 percent, was the highest in the country).
click on graph for interactive version
Again, public programs pick up some of this slack. Since 2000, Iowa has enrolled about 120,000 more working age adults in Medicaid, and added another 80,000 to the ranks of the uninsured. For Iowa’s kids, public coverage (Medicaid and hawk-i) has been much more effective — picking up 140,000 Iowans under the age of 18 since 2000, while actually reducing the number of kids uninsured.
Posted by Colin Gordon, Senior Research Consultant
When the costs of insurance keep rising, that makes it tougher on the household budget — or results in people not having insurance.
The Cedar Rapids Gazette today offered an interesting look at the question of where Iowans get their insurance. It’s less and less something that comes through employment. And when the costs of insurance keep rising, that makes it tougher on the household budget — or results in people not having insurance.
The Affordable Care Act offers at least a partial remedy. As health insurance exchanges are developed, affordable insurance should be more readily available. Tax credits for employers providing insurance will provide a targeted incentive to offer employees a better option than what employees might find on the individual insurance market.
Our State of Working Iowa report for 2012 offers another good look at this issue. As author Colin Gordon observes, wage stagnation, erosion of good jobs and recession have combined to batter workers, at the same time non-wage forms of compensation, health and pension benefits, also have declined. This has eroded both job quality and family financial security, and increased the need for public insurance. In Chapter 3, “The Bigger Picture,” Gordon writes that Iowa is one of 15 states, including five in the Midwest, to lose more than 10 percent of job-based coverage in a decade. He continues:
These losses reflect two overlapping trends. The first of these is costs. Health spending has slowed in recent years, but still runs well ahead of general inflation. Both premium costs … and the employee’s share of premiums have risen sharply — especially for family coverage — while wages have stagnated.
In 1999, a full-time median-wage worker in Iowa needed to work for about 10 weeks in order to pay an annual family premium; by 2011, this had swollen to nearly 25 weeks. Steep cost increases have pressed employers to drop or cut back coverage, or employees to decline it when offered. High costs may also encourage more employees to elect single coverage — counting on spousal coverage from another source and kids’ coverage through public programs. The second factor here is the shift in sectoral employment outlined above: Job losses are heaviest in sectors that have historically offered group health coverage; and job gains (or projected job gains) are strongest in sectors that don’t offer coverage.
This graph looks at the rate of employer-sponsored coverage, by industry sector, from 2002 to 2012.
An interactive version of that graph in the online report allows the reader to toggle between those two years; the colored balloons sink on the graph in moving from 2002 to 2012, as if they all are losing air — the result of declining rates of coverage.
Fortunately, the discerning Iowan can find the facts about the federal budget by looking for them, and not buying into Dick Morris’ spin.
Political consultant Dick Morris slipped into Iowa last week, and the Spin-O-Meter was in overdrive.
Now, rather than repeat Mr. Morris’ misinformation, here is a link to a Des Moines Register story about his appearance at a rally orchestrated by the national right-wing organization Americans for Prosperity.
What Iowans need to know is that (1) Morris is wrong about what is driving the federal budget deficits, and (2) the causes are clear: You can’t cut taxes and fight two wars at the same time without digging a big budget hole.
As shown in the graph at right from the Center on Budget and Policy Priorities, the economic downturn, President Bush’s tax cuts and the wars in Afghanistan and Iraq explain the vast majority of the deficit through 2019. One thing folks must recognize is that deficits caused by those factors cause more debt down the road, because we have to keep paying interest. Even after the Iraq war ended, we have to keep paying for it.
As we deal with these self-inflicted budget problems, we must maintain the fundamental and long-accepted responsibilities of our nation — to care for the most vulnerable and put them on their feet to get work and succeed in our economy.
Dick Morris has a big megaphone to try to instill something other than a factual presentation about what’s causing our deficits and debt. Fortunately, the discerning Iowan can find the facts by looking for them, and not buying into the conventional spin he delivers in his traveling medicine show.
The central purpose of the law should not be lost in the discussion: to expand health insurance coverage and help create a health system that works for everyone.
While many are focusing on the political and judicial ramifications of today’s Supreme Court ruling affirming the constitutionality of the Affordable Care Act (ACA), it’s important to focus on how the law will affect health coverage.
ACA provisions at the heart of the Supreme Court decision are the personal responsibility requirement (or individual mandate) and the Medicaid expansion. Both provisions are not scheduled to take effect until January 1, 2014.
However, a number of provisions have been in effect since 2010 — shortly after the law’s passage, and have helped make insurance coverage accessible and more affordable for millions of Americans. Today’s ruling upholding the law means that millions of Americans will retain that coverage and those benefits.
Among the provisions currently in effect:
Young adult coverage — Uninsured persons age 18 through 25 may continue to be insured as a dependent on their parents’ health coverage. This provision has extended health care coverage to an estimated 6.6 million young Americans.
Protections against pre-existing condition exclusions for children — The ACA prevents insurers from denying coverage to sick children. In Iowa, there are up to 51,000 children who have pre-existing conditions.
The end of lifetime and annual benefit limits — Consumers with serious health conditions and treatment expenses no longer need to worry about bumping against maximum amounts an insurer will pay.
The elimination of the Medicare “doughnut hole” — Under existing Medicare law, seniors with high prescription costs had to pay for prescriptions entirely out-of-pocket. The ACA gradually eliminates this “doughnut hole,” providing seniors a 50 percent discounts on name-brand drugs and a 7 percent discount on generic drugs.
Tax credits for small businesses — Small businesses that meet specified qualifications may presently receive a tax credit if they offer their employees coverage and cover at least half of the premium cost. Estimates of the number of eligible businesses vary, from about 2.6 million to about 4 million. Take-up has been limited, partially due to lack of awareness.
Provisions that will take effect in 2014:
Expanding Medicaid coverage — Under the ACA, uninsured individuals with earnings at or below 133 percent of the federal poverty level ($30,657 for a family of four in 2012) will qualify for enrollment in Medicaid. If Iowa fully participates in the Medicaid expansion, as many as 114,700 Iowans may receive coverage.
Creation of new insurance marketplaces, or “exchanges” — The ACA instructs states to construct new insurance marketplaces, accessible by Internet, in which those who don’t receive insurance through their employer may shop for insurance coverage. Individuals who don’t qualify for Medicaid coverage will receive tax credits to help them cover the cost of their heath premium. This is the group affected by the individual mandate. According to estimates, as many as 250,000 Iowans could find their health coverage through the new insurance marketplace, or exchange.
While legal scholars and political pundits will undoubtedly have much to say for months on today’s decision, the central purpose of the law should not be lost in the discussion: to expand health insurance coverage and help create a health system that works for everyone.
Two recent reports highlight Iowa’s success in extending health insurance coverage to children.
Two recent reports highlight Iowa’s success in extending health insurance coverage to children. Both reports are the work of the Kaiser Family Foundation (KFF), a nonprofit private operating foundation, based in Menlo Park, Calif., dedicated to producing and communicating the best possible information, research and analysis on health issues.
The first report — “Performance Under Pressure: Annual Findings of a 50-State Survey of Eligibility, Enrollment, Renewal, and Cost-Sharing Policies in Medicaid and CHIP, 2011-2012” — demonstrates the steps that all states are taking to cover children. For instance, hawk-i, Iowa’s version of the Children’s Health Insurance Program (CHIP), has expansive income eligibility guidelines, allowing children from families with income up to 300 percent of the federal poverty level ($67,050 for a family of four) to enroll in the program. Only two states (New York and New Jersey) have broader eligibility guidelines.
Iowa has enacted other policies that make enrolling in public programs less cumbersome, less costly, and more consistent with the goal of getting kids covered.
KFF’s second report highlights Iowa — along with Alabama, Massachusetts and Oregon — among states leading the way in children’s health coverage. “Secrets to Success: An Analysis of Four States at the Forefront of the Nation’s Gains in Children’s Health Coverage” notes that Iowa has experienced, thanks to its use of CHIP in policies including hawk-i, a nearly 20 percent decrease in the number of uninsured kids. Efforts to expand and simplify the eligibility and enrollment process are key to Iowa’s success in covering kids.
As we noted last month, Iowa’s efforts to cover kid not only help the kids and their families, but also help the state. The U.S. Department of Health and Human Services awarded Iowa with a $9.5 million Children’s Health Insurance Program Reauthorization Act bonus payment in late December, in reward for the state’s efforts to expand children’s health insurance coverage.
Though Iowa has implemented some of the policies that led to success in kids’ coverage in the adult health coverage program, Medicaid, additional policy changes could further reduce the overall rate of uninsurance in the state. For instance, Iowa’s Medicaid eligibility thresholds are Iowa are quite low, especially in comparison to hawk-i eligibility levels.
Both Kaiser reports note that Iowa, like every state, will face challenges to maintain and further improve its health insurance coverage. Budgetary pressures, burgeoning caseloads and a growing strain on information technology systems make it difficult. However, both articles illustrate a number of policies Iowa could pursue to continue to be a leader in kids’ health coverage.
Two thoughts as the 2012 legislative session nears: What is worth your time and attention? And, be careful what you wish for.
Both are vital reminders for all of us in our increasingly busy world. But as Iowa lawmakers again consider proposals for the competitive health insurance marketplace, or health insurance exchange, these reminders are relevant to health reform stakeholders.
Last legislative session, way back before the Fiscal Year 2012 budget gridlock, or the property tax debate, several lawmakers issued proposals for the creation of an exchange.
One proposal (which won the support of the health underwriters’ and insurance brokers’ lobby and no one else) seemed far more interested in protecting the insurance brokers than it was in creating an exchange that helps Iowans get affordable, quality coverage. Under that proposal, every purchase in the exchange would have been mediated by a broker, who, by law, would have received at 5 percent commission on each insurance sale in the exchange.
It’s worth remembering how the exchange is intended: Individuals, families, and small businesses will be able to quickly and easily compare health insurance plans — based on price, value, benefits and other relevant factors — and premiums will be based strictly on age, geographic area, and smoking status. Pre-existing conditions will be a thing of the past.
The exchange should permit small businesses to leverage some of the bargaining power of the larger employers. Many small businesses that offer employees coverage will be eligible for tax credits.
According to projections from the nonpartisan Congressional Budget Office, however, most exchange users will be individuals and families. Low- and moderate-income (up to 400 percent of the federal poverty level, or about $89,000 for a family of four) individuals and families who do not receive insurance through an employer will be eligible to receive sliding-scale premium assistance in the form of tax credits. Small businesses are likely to comprise a much smaller slice of the exchange-user pie.
This brings us back to the question this post opened with, what is worth your time and attention?
Do brokers really want to be involved in every purchase of health insurance in the exchange? Remember that most of these exchange customers won’t be HR folks, familiar with the ins and outs of insurance terminology. Most won’t be the proprietors of small businesses that have dealt with brokers in the past and know what sort of benefit and cost-sharing packages their employees have or haven’t liked.
Most exchange users are going to be members of ultra-small groups — families. Many will have moderate levels of income ($37,000 a year to about $89,000 a year for a family of four). For many, the terminology of health insurance terminology will be a new language. Deciding what benefit package they want or need will be a calculus as difficult as, well, calculus.
Is a bill like last session’s SF391 really the best use of a broker’s time and attention? I’m not a broker, so I’m in no position to say.
But it seems that rather than spending four hours describing insurance terms, benefits, and options to a family of four that has never purchased health insurance and earns $35,000 a year is a far less effective use of time than spending an hour on the phone with a seasoned HR rep from a business with 30, or even just 10 employees. And let’s not forget that many exchange users will end up not even purchasing insurance, but become enrolled in the newly expanded Medicaid.
Regardless of health reform implementation, there will be continued demand for the services of insurance brokers. They provide a valuable service, and are trusted by many small businesses and entrepreneurs. That won’t change.
But if brokers push for a repeat of last year’s offerings, they may just give themselves business that they don’t really want. Be careful what you wish (and lobby) for.