Image

My privilege is this much bigger than yours!

The ACA/Obamacare is a flawed piece of legislation. It will not provide universal coverage, and there is little reason to think it will control costs. I find arguments against incremental reform in health care (and indeed, almost all systems) very compelling. While the debate of incrementalism vs. true reform/revolution is deserving of much reflection, that isn’t the intention of this particular post. I want to talk about how the implementation ACA/Obamacare is playing out in Virginia and what the implications of this are for the 99%.

There are two large issues in the short term regarding how the ACA will affect Virginia. The first is that Gov. McDonnell has said Virginia will not be setting up its own health care insurance exchange, and as a result will not be getting the federal money for Medicaid expansion.

Go ahead and skip this paragraph if you know what the exchanges are – this is just a refresher. The exchanges are based on the idea that by pooling small businesses and individuals together to function as a large company, they can buy insurance at rates comparable to what big businesses already pay. It was in recognition that because of less bargaining power, small businesses and people buying insurance on their own often pay far higher than what large businesses are able to negotiate. —States can lump individual and small business together in the same pool or they may be separate. There are four levels of benefit packages offered with varying percentages of health care costs covered (certain minimum coverages included) – from bronze (pays 60% of actuarial value of plan benefits) to platinum (pays 90%). People under 30 who would not be required to purchase insurance because it exceeds 8% of income will be able to buy “catastrophic” coverage. The exchanges must limit cost-sharing, with no annual or lifetime caps in coverage, and a maximum of $2k for premiums of individuals and $4k for families (the actual number is subject to change in the future). Yeah, it gets really complicated. The exchanges are supposed to be in place by 10/1/13 so people can start shopping, buy their plan, and have their coverage start on 1/1/14.

The states were given the option of setting up their own exchanges, or they could default to a federally-operated exchange. The catch is that by defaulting, they lose the federal funds to expand Medicaid.

The Medicaid expansion is a tricky subject. In order to get an idea of what Medicaid currently is like in Virginia, consider these facts: Unemployed parents in a family of three with incomes over $4,772 make too much to receive Medicaid coverage (25% of federal poverty line), while employed parents in a family of three who earn over $5,744 make too much to receive Medicaid coverage (31% of federal poverty line). Obamacare expands Medicaid eligibility to 133% of the federal poverty line. In 2014, that corresponds with an income of  $14,856 for a single person and $19,378 for a family of three. This would result in about 420,000 more Virginians covered, 84,000 of them kids.

The Supreme Court ruling that upheld Obamacare in June 2012 also said that states could not be forced to use their money to expand Medicaid. This was still decided even though care was taken during the crafting of the bill to not impose excessive burden on the states which tend to have more variable expenses and incomes. In fact, the federal government would pay 100% of Virginia’s Medicaid in 2014, and gradually reduce to 90% starting in 2020. However, if Virginia waits until 2016 or 2020, that drops to 95% or 90% immediately.

There is absolutely no reason to refuse this money from the federal government. It is especially important to take this money because the amount of federal dollars given through the Disproportionate Share Hospital (DSH) program for hospitals serving lots of uninsured patients is decreasing.  This means that in states like Virginia that won’t be receiving federal money for Medicaid expansion, hospitals serving the poor will be disproportionately hurt. Even the argument that McDonnell is using regarding the instability of the federal money holds no weight:

“I don’t believe the federal government can possibly deliver its commitment to fully fund the program, and I don’t want to be part of contributing trillions of dollars to the national debt.”

If in subsequent years Virginia found that it was unaffordable to continue the expanded Medicaid, it could withdraw from the program (and lose federal funds). The Virginia Chapter of the American College of Physicians, an organization of Internal Medicine specialists and medical student members (including yours truly), recently released a report detailing how the Medicaid expansion will benefit Virginia. It’s pretty compelling stuff. Basically, Medicaid saves lives, and reduces racial and ethnic disparities in health care, with over 40% of the those affected by the Medicaid expansion being people of color.

Let’s review what happened immediately after Obamacare passed in March 2010. The Virginia General Assembly passed the “Virginia HealthCare Freedom Act,” which was basically written by the corporate-backed American Legislative Exchange Council as the “Freedom of Choice in Health Care Act.” This made it illegal for the government to require the purchase of insurance.  Our Provocateur-ney General Ken Cuccinelli then used this as the basis to file suit against the federal government, which, of course, ultimately failed.

What is the purpose of fighting the Medicaid expansion so hard if it would genuinely help the poor of Virginia? The purpose is to chip away, undermine, and sully the reputation of publicly funded and administered health care. If Medicaid works for the people of Virginia, then that is yet another weak link in the argument that complete privatization of health care and voluntary coverage is the only “right” way (never mind that Obamacare essentially ensures this anyway).  Conservatives love to demonize Medicaid, continuously underfunding it and fighting attempts to improve it. Medicaid, like the current Medicare, is highly flawed, pays much less than private insurance, and is mostly inaccessible for all but the poorest of the poor. (But people with Medicaid are still better off than with no insurance at all!)The reason is because the powers that be have vested interests in profiting off health care, and Medicaid stands in their way.

Take action to help the Medicaid expansion happen in Virginia. Contact your state senators and delegates.

Advertisements