Currently, some 55 million Americans are without health insurance. That includes about 650,000 Oklahomans, or one in six state residents.. The Affordable Care Act (ACA) was designed to reduce the number of uninsured by expanding access to quality, affordable coverage. With the major expansion provisions set to take effect at the beginning of 2014, there is likely to be substantial progress made towards that goal. However, it is also clear that a significant number of people will remain without coverage, especially in states like Oklahoma that have so far opted not to accept federal dollars for extending Medicaid coverage to low-income adults.
The ACA establishes two primary mechanisms for expanding coverage for the uninsured. Individuals with incomes between 100 percent and 400 percent of the federal poverty level are eligible for premium tax credits that will subsidize the cost of coverage on the new health insurance marketplaces, or exchanges, that will launch in January 2014. Working-age adults with incomes below 138 percent of poverty were to become eligible for Medicaid, but the Supreme Court’s ruling last June left states the choice of expanding Medicaid. Other provisions of the ACA, including small business tax credits and the employer coverage mandate, are intended to provide coverage to more people through their employers.
Last month, the Congressional Budget Office (CBO) released updated projections on the impact of the ACA on health insurance coverage. The CBO projects that by 2016, the number of uninsured will decrease from 55 million to 30 million, and the uninsured rate among the non-elderly population will drop by nearly half, from 20 percent to 11 percent. These projections take into account the Supreme Court’s ruling and the decision by many states not to move forward with Medicaid expansion (In March 2012, before the Court’s ruling, the number of uninsured in 2016 was estimated at 26 million, and the non-elderly uninsured rate was expected to be 9 percent).
The CBO now projects that an additional 12 million Americans will be covered by Medicaid in 2016 (compared to a projected growth of 17 million before the Court’s ruling). Twenty-two million Americans are expected to be insured through the health insurance exchanges in 2016, two million more than their projection of March 2012.
What will be the situation in Oklahoma? The CBO doesn’t provide state-level estimates but a pair of studies have done so:
- A study by leading health policy experts from the Urban Institute for the Kaiser Family Foundation (KFF) projects that if Oklahoma expands Medicaid, the uninsured population in the state will decline by 54 percent to 295,000 in 2022. If Oklahoma does not expand Medicaid, the uninsured population will decline by 34.9 percent to 421,000;
- A study posted last week by Rachel Nardin and colleagues (Nardin et. al) on the Health Affairs blog has more pessimistic estimates. It projects that the uninsured population will decline by just 19 percent to 515,000 in 2016 if Oklahoma does not expand Medicaid and will decline by 48 percent to 331,000 if the state does expand.
The large discrepancy between the two studies’ projections of the number of uninsured if the state does not expand Medicaid is significant, since state leaders have so far chosen not to join the expansion. Nardin et. al project that in states that do not expand Medicaid, a full three-quarter (75 percent) of the currently uninsured with incomes above 138 percent of poverty will remain uninsured. They assume that states that reject Medicaid will also see significantly lower enrollment in coverage on the exchange among those who are eligible.
There are reasons to be hopeful that of the two, the KFF study, which is based on a long-established, sophisticated model that takes into account demographic and policy differences between the states, will be more accurate. However, despite their differences, both studies lead to three important conclusions.
The first is that the failure to extend Medicaid significantly increases the number of Oklahomans who will be left without health insurance. Under the Kaiser Family Foundation’s more optimistic projections, just under two-thirds (65 percent) of those who are currently uninsured will remain uninsured if the state reject expansion. Those with incomes below the poverty level will be left in a gaping ‘coverage crater‘, without options for affordable coverage. This large uninsured population will continue to take a toll on the health and financial security of Oklahomans, while placing a large burden on hospitals and other providers of uncompensated care.
Secondly, the studies make clear how critical it will be to connect the uninsured to new coverage options through the health insurance exchanges set to launch in the coming months. Some 330,000 Oklahomans will be eligible for premium tax credits on the exchange, according to a Families USA study. Oklahoma’s success in reducing our number of uninsured will depend on successful outreach and enrollment efforts by “navigators” and other entities.
Finally, these studies remind us that the effort to ensure that every American has access to affordable and quality health insurance will continue long past January 2014. The Affordable Care Act will mark an important but imperfect step towards this goal, leaving crucial work for policymakers and advocates in the years ahead.
For all of OK Policy’s materials on Medicaid and the Affordable Care Act, click here.