Obamacare Could Help Save Detroit Money, But Only If Michigan Residents Understand How It Works


Detroit emergency manager Kevyn Orr and Michigan Gov. Rick Snyder

Gov. Rick Snyder (R-MI)

Gov. Rick Snyder (R-MI)

As Detroit faces bankruptcy, Gov. Rick Snyder (R-MI) has been considering an unusual tactic to help the struggling city save money: using Obamacare to shift Detroit’s health costs around. Detroit could stop providing city-run coverage for older residents who are too young to qualify for Medicare coverage, since those people will be able to access health insurance in Obamacare’s new insurance marketplaces.

But there may be some practical issues with that approach. The GOP-controlled state hasn’t exactly invested a lot of resources into educating the public about Obamacare, so not many Michigan residents understand how to sign up for the new plans. If Snyder really does want to encourage more retired people to enroll in Obamacare’s marketplaces, he may have to get his Republican colleagues on board with some education campaigns about health care reform.

“They say open enrollment starts Oct. 1. Nobody knows what to do,” Don Taylor, the president of the Retired Detroit Police and Fire Fighters Association, told Bloomberg Businessweek. “The state doesn’t know. The city hasn’t done anything.”

Michigan refused to set up its own state-run marketplace under the health law, so federal officials are stepping in to do it. That ultimately means there are fewer state resources dedicated to enrollment efforts in Michigan. A state-run program would have had its own office, computers, and website — as well as a larger operating budget. Instead, a coalition of nonprofit groups and health clinics are trying to get the word out about Obamacare.

Four nonprofits are splitting a $2.5 million federal grant to help teach people about Obamacare plans, and an additional $3.7 million grant will go to 31 health centers to help enroll uninsured Michigan residents. But they say they don’t have enough money for advertising, and are being forced to rely too much on word-of-mouth.

“No question we are going to miss folks,” said Don Hazaert, the director of Michigan Consumers for Health Care, told Bloomberg. Hazaert’s organization is one of the four tasked with educating people about health reform, but they’re daunted by the task at hand. “The vast majority who are eligible for health-care coverage don’t know it. Someone has to explain it for them,” he continued.

Michigan is hardly alone. In many red states, figuring out how to enroll in Obamacare’s new marketplaces is no easy feat — largely because Republican officials haven’t tried very hard to ease the process. In states like Missouri and Georgia, Republican legislators have refused to spend any money whatsoever to promote the health law. And even though the federal government has awarded grants to over 100 nonprofits across the country to assist in enrollment efforts, anti-Obamacare state laws have created red tape that’s already making it difficult for those groups to carry out that work.

Now, there are big gaps in Americans’ knowledge about the health law. Over 43 percent of uninsured Americans don’t know that they will be required to buy insurance in the new Obamacare marketplaces in the fall. Many Americans in red states know that “Obamacare” is supposed to be a bad word, but have no idea they’ll be eligible for increased consumer protections under the new law that will benefit them and their families.

Michigan’s GOP governor has butted heads with his party over Obamacare several times over the past year. For months, he begged his fellow Republicans to expand Medicaid to cover additional low-income residents, and was disappointed when they adjourned for the summer without doing so. Snyder also tried to set up a state-run insurance marketplace so that Michigan would have more control over it, but couldn’t convince the GOP legislature to get on board. And he’s not done yet. A spokesperson for Snyder told Bloomberg that the governor is planning on setting up a hotline to answer people’s questions about the health reform law.