Although the Supreme Court upheld the overall constitutionality of the Affordable Care Act over the summer, its ruling on Medicaid expansion gives states much autonomy. Individual states are allowed to opt out of Medicaid expansion. How North Carolina will move on Medicaid expansion is currently unclear. Opting in would have bring copious benefits to the state, which senior Elena Botella outlines below.
North Carolina Medicaid Expansion Fact Sheet
By Elena Botella
Currently, very few North Carolinians are eligible for Medicaid, and many working North Carolinians are uninsured
- One in three adults under the age of 64 with a household income less than 200% of the poverty line are uninsured – this amounts to 1,053,200 North Carolinians. 80% of the uninsured in North Carolina are a part of households with at least one employed member.
- At present, non-elderly adults without young, dependent children or serious disabilities are under no circumstances eligible for Medicaid in North Carolina. Those with dependent children are eligible for Medicaid only if they earn less than 49% of the federal poverty level – $11,294 for a family of four.
Medicaid improves the health outcomes and the financial security of its recipients.
- A 2011 study by Drs. Baicker and Finkelstein in the New England Journal of Medicine examined the outcome of a lottery performed in Oregon to randomly allocate a limited number of Medicaid spots for eligible low-income adults over a three year time-span (2008-2011). They found that those who received Medicaid were 55% more likely to report having a usual doctor, were 60% more likely to receive a mammogram, and were 20% more likely to be monitoring their cholesterol. Medicaid reduced by 40% the probability that an individual would report having to borrow money to pay for medical care, or skip payment on other bills as a result of medical expenditures. It decreased by 25% the probability that an individual had unpaid medical bills sent to a collections agency. Medicaid enrollees were 25% more likely to self-report being in good, very good more excellent health, and were 25% less likely to screen positive for depression. This data is all the result of a randomized, controlled trial.
- According to BlueCross BlueShield of North Carolina, the uninsured have a 25% greater chance of premature death. There are 18,000 avoidable deaths annually among the non-elderly due to a lack of health insurance coverage.
While hospitals are required to provide emergency room care to the uninsured, they can, and do, bill the very poor for care received. For the uninsured, a health emergency can result in financial disaster – wiping out savings, and in many cases resulting in bankruptcy or eviction.
- Uninsured patients oftentimes find themselves unable to pay for the life-saving treatments they’ve received in our states emergency rooms. Medical bills that go to collections can damage an individual’s credit score for 7 years, even if the debt is eventually paid off – the lower credit score can influence the difficulty that individual faces in finding a job or affordable housing.
- Uninsured patients are regularly billed up to two-and-a-half times the amount that insurance companies are billed for the same treatment, because insurance companies are able to negotiate lower rates for treatments, but uninsured individuals are unable to.
- Three fifths of all bankruptcies nationwide are related to medical expenses.
Medicaid expansion would provide federal funds for the state of North Carolina to provide health insurance for the working poor
- If North Carolina opts in, the federal government will provide federal funding to expand Medicaid to those up to 138% of the federal poverty line—covering up to 720,000 North Carolinians, who make less than $15,000 in earnings as an individual or $31,000 for a family of four. The federal government will pick up 100 percent of the cost of expansion for the first three years (2014-2016) and will cover at least 90 percent of the cost thereafter. Over the first six years, Medicaid expansion would cost North Carolina $138 million per year, and would bring in more than $15 billion federal dollars. This amounts to a cost to the state of North Carolina of just $188 per year per newly insured person.
- Medicaid expansion would save the state of North Carolina money because the federal funding would more than offset money we are spending to provide healthcare in other parts of the budget
No matter what North Carolina decides, North Carolinians will be paying taxes to finance Medicaid expansion. The question is whether this money will return to North Carolina, or will be spent in other states.
- Medicaid expansion replaces some existing federal programs benefitting North Carolina, so if North Carolina fails to expand Medicaid, many North Carolinians, especially in rural areas, will suffer. Medicaid expansion replaces federal aid to hospitals currently providing indigent care. If Medicaid expansion passes, hospitals that are struggling in high-poverty areas, especially in rural North Carolina, will thrive with an influx of newly insured patients.
- Bringing in 9 dollars into the state per one dollar spent makes good fiscal sense. As an example for, every one dollar spent by a film or TV company, the state of North Carolina gives the company a quarter back.
- The Congressional Budget Office projects that the Affordable Care Act – which includes Medicaid expansion – is overall revenue positive, that is, it decreases the size of the deficit. The ACA and Medicaid expansion are paid for in part by a 2.3% tax on medical devices, a new floor on medical expense deductions, and a 3.8% tax on investment income. North Carolina will pay these taxes to fund Medicaid expansion whether or not they take the federal dollars.
Medicaid expansion will decrease the amount of uncompensated care in North Carolina—helping to make health insurance more affordable for other North Carolinians
- Every year, N.C. doctors and hospitals provide more than $3 billion in uncompensated care to the uninsured. The cost of this care is passed along to those North Carolinians that do have health insurance – raising premiums. The Raleigh News and Observer has estimated that uncompensated care raises the average family group premium by more than $1,000 annually.
- Cost savings from the reduction in uncompensated medical care is estimated to reach between $1 and $2 billion between the period 2014-2019, with the most conservative estimate still outpacing the state’s projected $830 million in costs associated with the Medicaid expansion.
Medicaid expansion is good for business
- The Affordable Care Act introduces penalties beginning in 2014 to businesses that do not provide health insurance to their employees. However, if an employee receives Medicaid, the business will not be penalized for failing to prove insurance.
- As noted by the Raleigh News and Observer: “Many of those without health coverage are adults with low-wage jobs. Medicaid coverage will provide check-ups and access to prescription drugs, preventing or managing chronic illness. A workforce with health insurance is healthier and more productive. If we don’t implement the expansion, these uninsured citizens will not qualify for federal tax subsidies to buy private health insurance because the ACA limits those subsidies to families that are not in poverty. Again, businesses in other states will have a competitive advantage.”
- Medicaid expansion is expected to create 23,000 jobs in our state
Medicaid expansion is strongly supported across the state
- Groups publicly supporting Medicaid expansion include the AARP-NC, the American Diabetes Association, the Autism Society of North Carolina, the Duke University Health System, the Lake Norman Community Health System, Legal Services of Southern Piedmont, the League of Women Voters of Charlotte-Mecklenburg, the North Carolina Council of Churches, the Urban Ministry Center (Charlotte, NC), and the YWCA of Central Carolina, among others.