Minding the Gap

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Supporters of Medicaid expansion demonstrated at the State Capitol in August. Photo courtesy Virgnia Organizing

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Opponents of Medicaid expansion demonstrated at the State Capitol in August. Photo courtesy Chip Jones

The health-insurance marketplaces established by the federal Affordable Care Act are intended to make insurance accessible to those who don't have it. But when enrollment opens Oct. 1, thousands of uninsured Virginians won't be able to sign up. That's because the state has not yet expanded its Medicaid program to include up to 400,000 residents who don't currently qualify.

Jill Hanken, a health-law attorney with the Virginia Poverty Law Center, says that people whose incomes are between 100 percent and 400 percent of the federal poverty level — roughly $11,500 for an individual or $23,550 for a family of four — could qualify for premium tax credits or subsidies if they buy insurance through the exchange. Of the approximately 1 million Virginians who currently don't have health insurance, about 500,000 of them likely will be able to sign up through the marketplace, accessible online at healthcare.gov , says Kathy May, director of Virginia Consumer Voices for Healthcare.

Anyone who has an income below the poverty level and doesn't qualify for Medicaid would continue to use indigent-care services and safety-net providers.

"We don't know exactly how many will fall into the gap," Hanken says, adding, "Virginia's gap will leave hundreds of thousands of people out of luck."

As an incentive for states to expand the number of people who can receive Medicaid, the federal government has promised to pay the full cost of covering newly eligible adults for three years. The funding would start on Jan. 1, 2014, but it's uncertain when the General Assembly commission that's working on Medicaid expansion will complete its work. Made up of five state senators and five House of Delegates members, the Medicaid Innovation and Reform Commission (MIRC) is tasked with reviewing, recommending and approving reform proposals, and must meet a set of objectives outlined in the state budget for the expansion to take effect.

"I feel that we can accomplish it, but it's going to take significant effort," says Sen. Emmett W. Hanger Jr., R-Augusta, the commission chairman.

The clock is ticking. If Virginia doesn't expand Medicaid by Jan. 1, the state stands to lose $170 million per month — more than $5 million per day — in federal dollars available to cover 100 percent of the cost for new Medicaid recipients. After three years, that level of funding would gradually decrease to 90 percent by 2020.

"The revenue stream is already in place," Hanger says. "If we ultimately are going to expand [Medicaid], it's to our benefit to do it sooner rather than later."

Legislators are feeling political pressure as well. Opposition to "Obamacare" brought hundreds of protesters to the State Capitol during the commission's meetings, the next of which is set for Oct. 21. A public hearing is also being scheduled for October.

Americans for Prosperity, which organized the protests, is also rallying people who live in districts represented by Dels. Jimmie Massie and John M. O'Bannon III, two commission members, to urge them to oppose Medicaid expansion, says Dave Schwartz, the group's state director. Schwartz says his group does not believe "that a federal government that's trillions [of dollars] in debt is going to pay 100 percent of the expansion."

Citing a statistic that one in four physicians does not accept new Medicaid patients, Schwartz also argues that increasing the number of patients covered by Medicaid will mean lower-quality care for the very people who need the most help. "You're expanding a system that's already in shambles," he says. "It makes no sense."

Observers of the process also wonder about the effect of the gubernatorial election in November, given Republican nominee and Attorney General Ken Cuccinelli's strong opposition to the Affordable Care Act. Hanger says he is hopeful that if Cuccinelli is elected, his administration will be receptive to the reforms the commission is proposing.

And while state legislators consider Medicaid expansion, hospitals such as VCU Medical Center are facing a drop in both the federal and state money that compensates them for providing indigent care. To help pay for Medicaid expansion, the federal government will be decreasing Disproportionate Share Hospital funds to hospitals serving a large number of low-income patients, says Sheryl Garland, vice president for health policy and community relations with the VCU Health System. As the federal funds decrease, matching state funds also will drop, she says.

"We hope that state lawmakers will be sensitive to this issue," Garland says. "How will those folks who fall in that insurance gap receive care, and who will pay for it?"

Enrollment Help

If signing up for health insurance online through the federally run marketplace seems daunting, there are people ready to assist. The Virginia Poverty Law Center (VPLC) and Advanced Patient Advocacy (APA) have received funds to provide trained navigators to help. Jill Hanken of the VPLC says that her organization will have a website and toll-free support number. The APA will work with hospitals to enroll patients who need insurance. In addition to the navigators, the Virginia Community Healthcare Association is providing certified application counselors. The counselors will be available at community health centers such as those in Richmond's Capital Area Health Network, including the Vernon J. Harris Medical Center in Church Hill. People who have insurance through their jobs don't need to go through the marketplace enrollment process, but they may explore coverage options if they wish. The enrollment period opens Oct. 1 and continues through the end of March, but you must sign up by Dec. 15 for coverage to begin Jan. 1. Adults who do not get health insurance in 2014 would face a fine of $95 or 1 percent of taxable income — whichever is greater — an amount that increases to $695 or 2.5 percent of taxable income by 2016. However, there are exemptions for those with incomes below the tax-filing threshold and for financial hardship, religious beliefs and other factors. Resources: