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Leaving the Poorest of the Poor Without Health Insurance

Ilana Novick

Next month the Obama Administration will begin a nation-wide campaign to encourage low-income Americans to take advantage of the health insurance options that will come with the Affordable Care Act's Medicaid expansion. Sounds like a great idea, right? A long overdue publicity campaign for an important piece of legislation.

The catch is, some of the neediest people in states like Texas, Florida, Kansas, Alabama, Louisiana, Mississippi and Georgia won't be able to take advantage of the new insurance. All seven are refusing to expand Medicaid.

According to a recent New York Times article, more than half of all people without health insurance live in states that are not planning to expand Medicaid. The opposition to receiving government money, even no strings attached government money to help these state's poorest citizens, is so offensive to these states that they see refusing to join the Medicaid expansion as somehow akin to resisting government tyranny. 

In some cases, the private options that various state governors have fought for instead will make up at least a portion of that coverage. Low-income Americans who earn $11,490-$45,960 can still get federal tax credits cover to the purchase of private insurance. Tennesee and Arkansas are considering proposals that would allow the states to use the Medicaid expansion funds to create a private exchange.

The subsidies to cover the cost of purchasing private insurance will vary with income but are expected to average more than $5,000 a year in 2014 for each person who qualifies.

Ohio wanted use the private option, though as in Florida, a conservative state legislature is fighting it, despite support from Republican governors. In an odd, but certainly welcome turn for a Republican Governor, Jan Brewer of Arizona is refusing to sign any legislation until the Medicaid expansion is passed. She's not stupid. According to a recent Washington Post article, Medicaid expansion will bring billions of federal dollars into Arizona. 

But with many states not following Arizona's example, what happens to everyone who earns less than $11,490? Well they're apparently out of luck. Adults with incomes from 32 percent to 100 percent of the poverty level ($6,250 to $19,530 for a family of three) “will have no assistance," according to Kansas's Insurance Commissioner, quoted in The New York Times. Adding insult to injury, they'll see advertisements for new options, only to call and find out said new options don't apply to them. It's both infuriating and demeaning. 

The poorest of the poor won't get the coverage they need, but they'll still be subject to an advertising campaign encouraging them to apply for benefits they can't use. One social service provider quoted in the Times suggested that there will be an outcry, and that even when Medicaid was first proposed in the 1960s, it took some states a while to join, but they did. Let's hope that's true. Until then, social service organizations in the seven aforementioned states are about to become even more overloaded.