"CBS News Is Very Concerned About Too Many Poor People Signing Up For Obamacare"
A new report for CBS News’ Jan Crawford warns that an influx of sick low income Americans applying for health care coverage could “threaten the entire structure of Obamacare.” The story argues that a rush of new Medicaid enrollees applying for the expanded program “at no cost to them” would mean that there “won’t be enough healthy people buying insurance for the system to work”:
CBS News has confirmed that in Washington, more than 35,000 people are newly enrolled. 87% signed up for Medicaid. In Kentucky, out of 26,000 new enrollments, 82% are on Medicaid. And in New York, of 37,000 enrollments, Medicaid accounts for 64%….[B]ut a former director says the numbers are causing concerns in the industry which needs healthy adults to buy insurance in order for this to work….industry sources say if we don’t see real turnaround soon, there could be big problems for the entire system.
While Medicaid is responsible for thousands and of new enrollments and appears more successful in enrolling uninsured Americans than private insurers operating in the exchange, its success does not spell doom for reform. Medicaid expansion — which serves individuals below 133 percent of the federal poverty line — and private insurers attract different enrollees and operate in completely different risk pools. Individuals qualify for tax credits in the new marketplaces if they have incomes below 400 percent of the federal poverty line. “People eligible for Medicaid are not eligible for tax credits to help low and middle income pay their premiums in health insurance exchanges,” Lary Levitt, of the Kaiser Family Foundation, said, “so they were never expected to be part of the individual insurance market risk pool.”
It’s also not a surprise that so many Americans are enrolling in the public insurance program this month. Back in May, the Congressional Budget Office predicted that over half of the new Obamacare enrollees would consist of people signing up for Medicaid under the expansion of the program.
Several Medicaid experts ThinkProgress spoke to explained that the program, which was first signed into law in 1965, has years of experience in connecting low-income beneficiaries to health care benefits and has streamlined and simplified those processes. It is not dependent on the error-ridden federal exchange system and several states, including Arkansas, Illinois, West Virginia, and Oregon are auto-enrolling eligible individuals who are already receiving state benefits. Arkansas, for instance, sent letters to over 100,000 food stamp recipients, inviting them to apply for Medicaid coverage, along with a a stamped envelope and has enrolled 60,000 people. That program, incidentally runs through a “private option” waiver in which enrollees who would have been eligible for Medicaid are actually enrolling the very private exchange plans that Crawford claims are going under.
And as for those poor sick beneficiaries Crawford was describing, a study published in the Annals of Family Medicine, “found that newly eligible people are more likely to have an overall better health status than current beneficiaries, with 75 percent in ‘very good’ or ‘good’ health compared with 65 percent of current Medicaid recipients having ‘very good’ or ‘good’ health.”
If anything, the private exchange system can learn a lot from Medicaid’s high enrollment numbers — simplification, streamlining, and auto enrollment can help attract a lot of beneficiaries. That’s something that will help health care reform, not “disrupt it.”