At healthinsurance.org: Don't play ACA tennis on an unmarked court

I have a post up at healthinsurance.org that's a focused subset of my strategic guide to applying for coverage in the ACA marketplace. It's focused on the importance of knowing key "break points" in the income scale that determines ACA benefits:

Robert Frost said that writing poetry without rhyming was like playing tennis without a net. Applying for ACA coverage without knowing the income levels at which benefits change is like playing tennis without any lines. And when you don’t see the lines, it’s easy to hit the ball out.

This piece is largely though not exclusively concerned with the plight of working people in nonexpansion states at risk of being denied subsidized coverage because they forecast a next-year income below the Federal Poverty Level.  The logical and moral travesty of denying people affordable coverage because they earn too little is exacerbated by the fact that many in this situation could avoid being stiffed if they knew the income threshold they must reach. 

Of all the ACA's various gaps and friction points, none burn me as much as the coverage gap -- and the fact that many fall into through sheer ignorance of its existence. I have a more detailed guide to avoiding it here.

In May, CMS quietly moved to shrink the ACA's coverage gap in states that have refused to expand Medicaid

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One of the most intractable of the holes in the ACA's implicit promise of affordable care for all is the so-called "coverage gap" opened up when the Supreme Court made the ACA Medicaid expansion optional for states in 2012, two years prior to scheduled full implementation. 

As originally enacted, the ACA provided Medicaid eligibility to adults in households with incomes up to 138% of the Federal Poverty Level (FPL). In the wake of the Supreme Court decision, just 25 states implemented this expansion upon the 2014 launch of the ACA's core programs. To date, thirteen holdout states have not enacted it. In those states, eligibility for ACA marketplace subsidies begins at 100% FPL, and some 2 million adults with incomes below that level get no help obtaining insurance.

There's no easy way for Democrats to plug this hole, as KFF's Larry Levitt recently explained on Twitter. They could make people in nonexpansion states with incomes below 100% FPL eligible for premium subsidies. But that might tempt states that have enacted the Medicaid expansion to rescind it, since the federal government pays 100% of marketplace premium subsidies and "only" 90% of Medicaid costs for expansion enrollees. They could create a new federally administered public option operating in nonexpansion states, but that's a heavy administrative lift, and very likely beyond the political capabilities of a Democratic party with razor-thin majorities.

As I mulled Levitt's thread, a partial and kludgy administrative response occurred to me: CMS could allow any applicant in a nonexpansion state to attest to an income over 100% FPL, without requiring documentation. In 2020, supplemental unemployment insurance provided by the CARES Act pushed a lot of incomes over the 100% FPL threshold, and enrollment for 2021 at 100-150% FPL in nonexpansion states soared 17%. Marketplace subsidy eligibility is based on an estimate of next year's income, and low income is notoriously uncertain and fluctuating. Why not open the door further?

I took a look at the statute setting the terms for marketplace subsidy eligibility and verification (42 U.S. Code § 18081) and the 2022 Notice of Benefit and Payment Parameters (NBPP) published May 5, 2021, seeking a way that current rules might be modified. It turns out that new rulemaking is unnecessary. 

As of now (effective May 5), CMS is declining to require verification of an income claimed to be above 100% FPL even if data sources tapped by CMS indicate that the applicant's income is below that threshold. The change is announced in the NBPP: