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Congress Must Act to Protect Affordable Health Care in Maryland

June 8, 2022 by Christopher Meyer in Blog, Health

As many as 130,000 Marylanders will soon face unaffordable health insurance costs – or lose their coverage entirely – if Congress does not act quickly to extend premium assistance available under last year’s American Rescue Plan. The law increased premium assistance for people buying insurance through the Affordable Care Act marketplaces and newly extended assistance to middle-income families who previously had to pay often unaffordable premiums without any help. Congress must act quickly to extend this assistance.

The American Rescue Plan expanded premium assistance for people buying insurance through the individual marketplaces created under the Affordable Care Act (as opposed to obtaining insurance through their employer, Medicare, Medicaid, or another source). This expansion is making insurance more affordable for Marylanders who aren’t eligible for Medicaid but still struggle to make ends meet and can’t get affordable insurance through their jobs. It also for the first time guarantees that middle-income families who buy marketplace insurance don’t pay more than 8.5% of their income in premiums. Thanks in part to this expanded assistance and a special enrollment period in 2021, more than 181,000 Marylanders now have insurance through the marketplace – an increase of nearly 16,000 over last year and nearly 23,000 over 2020.

This expanded assistance is slated to expire at the end of 2022, but Congress cannot wait until later this year to act. If Congress doesn’t act soon, Marylanders shopping for marketplace insurance this fall will see higher premium estimates, which may scare many off from getting insurance at all:

  • If Congress allows enhanced premium assistance to expire, about 17,000 Marylanders will become uninsured, according to analysis by the Urban Institute.
  • Another 17,000 Marylanders will receive no assistance in purchasing marketplace insurance, and up to 98,000 will get less help than they do today, the U.S. Department of Health and Human Services estimates.
  • Altogether, the Urban Institute projects that Marylanders will lose $270 million in federal health care assistance in 2023 if Congress doesn’t act, and state Medicaid costs may increase by $4 million.
  • Thanks to Maryland policymakers’ smart choice to expand Medicaid under the Affordable Care Act, Marylanders facing the most financial hardship will generally be spared cost increases.

 

Higher insurance costs will have lopsided effects on people who already face greater health risks because of structural barriers built into our economy. Nationwide, the Urban Institute predicts that:

  • Black Americans will see the largest increase in the share without health insurance, from 8.6% uninsured if premium assistance is extended to 10.1% if Congress does not act.
  • Premium increases will also hit Latinx and American Indian communities hard, increasing the Latinx uninsured rate to 20.5% and the American Indian rate to 12.1%.
  • Families with income between 138% and 200% of the federal poverty line (about $38,300 to $55,500 for a family of four) will see the share without health insurance increase from 13.0% if premium assistance is extended to 15.2% if Congress does not act.

This spike in insurance costs will be all the more harmful if the Biden administration allows the federal public health emergency declaration to expire. The state of emergency provides more stability to people enrolled in Medicaid. If the administration allows it to end, about 190,000 Marylanders are expected to be kicked off of Medicaid – some because they will lose eligibility, and some who remain eligible but will fall through administrative cracks. This would result in a huge influx into the individual marketplace right as premiums become more unaffordable.

The only solution is for Congress to act quickly to extend the improved premium assistance levels at least through 2023. Here’s what you can do:

In the worst case that Congress does nothing, state policymakers can take two steps to cushion the blow:

  • Use state funds to strengthen premium assistance. Maryland is in a historically strong fiscal position. We should use a portion of projected surpluses to keep insurance affordable.
  • Guarantee stable coverage for kids insured through Medicaid/CHIP. Most states guarantee that any child who becomes eligible for Medicaid or the Children’s Health Insurance Program (CHIP) can remain eligible for 12 months, no questions asked – but Maryland isn’t one of them. We should guarantee 12-month continuous eligibility for kids to ensure that small changes in circumstances or administrative hurdles don’t cost kids their health insurance.