Medicaid expansion poses question of “life or debt”

Two leading researchers say early signs show Medicaid expansion under the Affordable Care Act will actually increase the number of Americans who are significantly underinsured – requiring even the poor to spend increasing sums of their own cash to close gaps left by deductibles and co-pays.

In 2003, nearly one in five persons – 18.2 percent – were underinsured according to the definition that they spent more than 10 percent of their family income on health costs, including insurance premiums.

“Paradoxically,” say Drs. Steffie Woolhandler and David Himmelstein of the City University of New York, that number may grow due to the Affordable Care Act. They report in the Journal of General Internal Medicine (published only on April 25, 2013) that CMS seems willing “to allow state Medicaid programs to demand copayments and deductibles, even from the poorest of the poor.”

Underinsurance may also be the fate of middle income persons who join the ACA’s new insurance exchanges. Bronze plans and silver plans under the new system will cover only 60 percent and 70 percent of average medical expenses, respectively.  “In effect, the federal government has lent its imprimatur to skimpy plans (long-promoted by private insurers) that offer scant protection from pauperization,” the authors conclude.

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