Friday, August 21, 2015

How many of the uninsured know what's on offer? Not many, Urban finds

With ACA private plan market enrollment lagging initial CBO projections, one key question is whether those who qualify for aid but remain uninsured are doing so because they can't afford what's on offer or because they still don't know what's on offer.

The Urban Institute's latest Health Reform Monitoring Survey (HRMS), conducted in March 2015, indicates that both factors are at work, but comes down more on the side of ignorance of what's on offer. That's "good news" in the sense that ignorance can be rectified for less money than too-skimpy offerings -- though an Urban analysis released earlier this week warns that outreach and marketplace operations are underfunded, as are the subsidies intended to make coverage affordable.

The HRMS found that 43.1% of still-uninsured have household incomes that may be* in the range that qualify them for subsidized private plans on ACA exchanges. Another 27.7% have incomes that would qualify them for Medicaid under the ACA expansion and live in states that have accepted the expansion (including an unmeasured percentage of both undocumented and legally present immigrants** who do not qualify). 22.6% are in the "coverage gap," earning under 100% of the Federal Poverty Level in states that have refused to expand Medicaid. Just 6.6% of the uninsured earn too much to qualify for any aid.

Fully 60% of those likely to qualify for aid say they remain uninsured because costs are too high or they can't afford coverage. But... here is the key point, in my view:

Among the potentially subsidy-eligible uninsured, only 27.6% have "heard about subsidies and looked for information on health plans through the Marketplace."*** Pair that with a finding from Kaiser's January 2015 survey of the uninsured, which  found that 49 percent of those who sought coverage and were told that they were ineligible (or understood as much) appeared, in fact, to be eligible for aid – either for subsidized private plans (30%) or Medicaid (19%). I reported here about several ways exchange visitors might get "false negatives," beginning with answering "no" when asked "do you plan to file a tax return?" (Many who earn too little to pay income tax answer 'no,' which disqualifies them for subsidies and triggers price quotes with the subsidies absent.)

This is not to say that many who qualify for subsidies do not nonetheless find viable coverage unaffordable -- or would, if they got as far as accurately determining what's on offer. As last week's Urban report claimed, the subsidies are underfunded; for many people with incomes over 150%  of the Federal Poverty Level (FPL), only the premiums for the lowest-tier bronze plans look affordable, and those plans carry deductibles in the $5000-$6850 range.  Cost Sharing Reduction (CSR) subsidies reduce out-of-pocket costs to a manageable level for those with incomes up to 200% FPL**** -- but CSR is available only with silver plans, for which subsidized premiums can look quite high for those over about 150% FPL (the benchmark silver plan will cost a person earning $23,000 about $118 per month). A bit less than 20/% of ACA private plan buyers with incomes under 201% FPL buy bronze plans that provide them with little protection against medical costs, forgoing CSR.

The HRMS found that 49.1% of uninsured adults had trouble paying for food or housing. Respondents in this group mainly regard health insurance as important, but not a top priority. Note, however, that more than half the uninsured (according to the HRMS) are either eligible for Medicaid or in the Medicaid gap in nonexpansion states. It would be worthwhile to know what percentage of those in the higher income cohort that's eligible for private plan subsidies have trouble paying for food or rent.

The CDC's National Health Interview Survey, conducted early this year, found that 28% of the poor, defined as those in households with incomes under 100% FPL, and 23.8% of the near poor, with incomes ranging from 100-200% FPL, were uninsured at the time of interview, versus just 7,5% of the not-poor. 100-200% FPL is actually the sweet spot for ACA private plan offerings. It would be useful to know what the uninsurance rate is for a narrower slice of the not-poor -- say, 200-250 or 200-300% FPL.  If there's not a heavy concentration of uninsureds just above 200% FPL, that would suggest that the subsidies are not quite as underfunded as Urban and others suggest. About one third of the U.S. population is under 200% FPL [paragraph added, 12:00 p.m.].

Many students of the ACA, including IBD reporter Jed Graham and the authors***** of last week's Urban Institute's "Next Steps" report referenced above, suggest that the ACA marketplaces will not reach full capacity or even viability unless private plan subsidies are sweetened to some degree. The subsidies should be improved; affordability is marginal for too many buyers, and high deductible bronze plans too tempting a trap.  But it remains unclear how many of the 40-plus percent of the uninsured who may be eligible for private plan subsidies would find current ACA offerings unaffordable or inadequate if they knew what was available.


* The HRMS classifies people with incomes from 139-400% FPL in Medicaid expansion states and from 100-400% FPL in nonexpansion states as "potentially eligible" for private plan subsidies. For many young buyers, however, premium subsidies phase out well below 400% FPL, because the unsubsidized cost of the cheapest plan is deemed affordable according to ACA formulas. Unsubsidized premiums can be as low as one third the costs for the youngest adult buyers as for the oldest.

** Many legally present immigrants or residents are subject to a "5-year bar" before they're eligible for Medicaid; some states have even longer waiting periods.

*** A McKinsey & Co. survey conducted in February 2015 found that only 47% of the persistently uninsured shopped for coverage, and 88% did not know the subsidy amount for which they were eligible.

**** CSR subsidies are available up to 250% FPL, but for those in the 200-250% FPL range they're almost negligible, raising the actuarial value of a silver plan to just 73% from a baseline of 70%.

***** Linda J. Blumberg and John Holahan. Authors of Urban's HRMS report are Adele Shartzer, Genevieve M. Kenney, Sharon K. Long, and Yvette Odu

1 comment:

  1. To some extent the designers assumed that everyone owns a computer and everyone reads the news paper. In other words, that everyone was a computer literate college graduate like themselves.
    Of course this does not apply to large numbers of poor people, and never has.
    It took many boots on the ground just to make use of the Voting Rights Act. It takes many field offices to enroll all eligibles into Social Security and Medicare.