issue brief COVERAGE OPTIONS For Mississippians After Implementation of the ACA PUBLISHED JANUARY 2014 As of January 2014, individuals in the United States are required to carry health insurance as a mandate under the Affordable Care Act (ACA), or they may be subject to a financial penalty. This brief describes coverage options for the uninsured in Mississippi and examines alternative coverage models being tested in other states. The Affordable Care Act (ACA) includes two primary components aimed at providing financial assistance for low-income uninsured persons to obtain 133% OR 138%? coverage: Medicaid expansion and subsidized coverage through Health Insurance Federal law provides for the expansion of Medicaid to Marketplaces (formerly known as “Exchanges”). The ACA’s expansion of Medicaid all individuals whose Modified Adjusted Gross Income initially eliminated categorical requirements (e.g. disability, age, or pregnancy), (MAGI) is at or below 133% FPL. Because the law also includes a 5% “income disregard” for Medicaid and allowed for coverage for all individuals based solely on financial status at or eligibility, the effective limit is 138% FPL. This report below 133 percent of the federal poverty level (FPL). The June 2012 U.S. Supreme will use 133% or 138%, depending on the context. 133%: Used to describe eligibility level Court decision that upheld the individual mandate allows for states to opt out of the 138%: Used to calculate the eligible population Medicaid expansion. Mississippi is among the 25 states not moving forward with expanding Medicaid in 2014. Health Insurance Marketplaces are intended to provide access to private health ANNUAL INCOMES ASSOCIATED WITH insurance plans. Individuals whose incomes are between 100 percent and 400 2014 FEDERAL POVERTY PERCENTAGES percent FPL may qualify for federally subsidized coverage, based on a sliding % FEDERAL POVERTY SINGLE FAMILY scale, which will only be offered through the Marketplace. Marketplaces can be LEVEL OF FOUR either state-based, federally operated, or a combination. Mississippi is one of 27 100% $11,670 $23,850 states which have a federally facilitated Marketplace in 2014. 138% $16,105 $32,913 Because low-income children, pregnant women, the disabled and the elderly currently may qualify for Medicaid or Medicare, they are less likely to be uninsured. 400% $46,680 $95,400 Therefore, the target population for federally subsidized coverage under the ACA Source: The poverty guidelines updated periodically in consists primarily of adults 19-64 years of age. Figure 1 illustrates the sources of the Federal Register by the U.S. Department of Health and health coverage for this group in Mississippi. Human Services under the authority of 42 USC 9002(2). FIGURE 1. ADULTS 19-64 YEARS OF AGE BY HEALTH COVERAGE STATUS, MISSISSIPPI (2012) 13% 3% 2% 5% 51% 25% Private (Employment Based) Uninsured Private (Purchased) Military Public Only Private and Public Source: American Community Survey. (2012). United States Census Bureau. Data Compiled by C4MHP using IPUMS-ACS. Note: Percentages may not total 100 due to rounding. 1 of 4 Center for Mississippi Health Policy � Issue Brief: Coverage Options—For Mississippians After Implementation of the ACA � JANUARY 2014 Mississippi’s Uninsured: A Closer Look FIGURE 2. MISSISSIPPI UNINSURED ADULTS 19-64 YEARS OF AGE BY FEDERAL POVERTY LEVEL (FPL) (2012) OVER 400 PERCENT FPL Individuals with incomes over 400 percent FPL are not eligible for subsidized coverage through the Marketplace. They are allowed to purchase insurance through the Marketplace, if they choose. Eight percent of uninsured non-elderly adults in Mississippi have incomes over 400 percent FPL. UNDER 100 PERCENT FPL BETWEEN 100 AND 400 PERCENT FPL Because it was initially defined in the law that Individuals with incomes between 100 percent individuals up to 133 percent FPL would be covered 37% 8% 55% and 400 percent FPL may be eligible for by an expanded Medicaid program, the ACA did 162,459 33,972 236,996 subsidized coverage through the Marketplace. not include individuals under 100 percent FPL in Options for the uninsured will depend on an the subsidies or cost-reduction programs. In states individual’s annual income and family size, as like Mississippi that are not expanding Medicaid, well as the availability and comprehensiveness individuals under 100 percent FPL will not be eligible of employer-based coverage. Approximately for public coverage unless they meet a categorical 55 percent of the uninsured non-elderly adult requirement, such as disability, age, or pregnancy. population in Mississippi falls between 100 Because their incomes fall below the 100 percent percent and 400 percent FPL. FPL threshold, individuals in this group will not be eligible for subsidies or cost-sharing reductions *Note: Individuals between 100 percent and 138 through the Marketplace. This group represents percent FPL may be eligible for expanded Medicaid approximately 37 percent of the uninsured or subsidies through the Marketplace, depending on non-elderly adult population in Mississippi. policy decisions at the state level. If a state expands Medicaid, this subgroup will be included in that coverage. If a state does not expand Medicaid, this subgroup may be eligible for subsidized coverage through the Marketplace. Approximately 15 percent *See Note of uninsured non-elderly adults in Mississippi (63,126) fall in this subgroup. Source: American Community Survey. (2012). United States Census Bureau. Data Compiled by C4MHP using IPUMS-ACS. Employment and Health Coverage If an individual has access to employer-based health coverage (through their own employer or a spouse’s employer) that is deemed “affordable” and of “minimal value,” he or she will not be eligible for subsidies, regardless of income. The IMPACT OF EMPLOYER COVERAGE determination of whether the premium is affordable is based on the cost of If an individual has access to employer-based health coverage that is deemed “affordable” and employee-only coverage compared to the household income. Consequently, a of “minimal value,” he or she will not be eligible policy may be classified as “affordable” even though the family premium may be for subsidies, regardless of income. more than the family can pay, resulting in some members remaining uninsured. AFFORDABLE: Employee contribution for The family members may be exempt from individual mandate penalties, however, employee-only coverage does not exceed 9.5% of because a different definition of affordability applies to penalties. Figure 3 annual income MINIMUM VALUE: Pays for at least 60% of the illustrates an example of this situation for a family of four with an annual income of actuarial value of services included in the plan $47,000 (200% FPL). FIGURE 3. EXAMPLE OF DETERMINATIONS OF AFFORDABILITY Employee Share of Premium as % Monthly Premium of Income Deemed Affordable? Single $0 0% Yes Coverage Family Yes* $593 15% Coverage *Because “affordable” definition is based on cost of single coverage 2 of 4 Center for Mississippi Health Policy � Issue Brief: Coverage Options—For Mississippians After Implementation of the ACA � JANUARY 2014 Half (51%) of Mississippi’s non-elderly adults have private, employment-based insurance coverage, a significantly (p<.01) lower rate of private health insurance coverage than the national average, which is 58 percent (2012). Mississippians who work for small employers (fewer than 50 employees) are more at risk to remain uninsured, as only 29 percent of small employers in the state offered health insurance in 2012. FIGURE 4. LEADING OCCUPATIONS IN MISSISSIPPI WITH UNINSURED WORKERS AT OR BELOW 138% FPL Cashiers 14,656 Stock Clerks & Order Fillers 3,035 Cooks 9,907 Laborers & Movers 2,918 Waiters & Waitresses 8,002 Personal Care Aides 2,682 Medical Aides 6,668 Carpenters 2,488 Maids & Housekeepers 6,430 Grounds Maintenance Workers 2,380 Truck & Other Drivers (Sales) 6,077 Agriculture Workers 2,362 Janitors & Cleaners 4,982 Other Production Workers 2,326 Construction Laborers 4,500 Painters & Maintenance 2,142 Retail Salespersons 3,340 Retail Sales Supervisors 2,058 Assemblers & Fabricators 3,216 Childcare Workers 1,780 Source: American Community Survey. (2012). United States Census Bureau. Data compiled by C4MHP using IPUMS-ACS. Selected Alternative Models Some states not opting to expand Medicaid as outlined in the ACA are testing alternative models for expanding coverage. A few examples are listed below: Wisconsin is not currently pursuing Medicaid expansion and will participate in the federally facilitated Marketplace. The state has proposed to decrease Medicaid eligibility for all types of beneficiaries from 200 percent to 100 percent FPL, and shift the uninsured over 100 percent of poverty to the Marketplace for coverage subsidized by the federal government. The money saved by removing this population from the Medicaid program would be spent to cover low-income persons, including approximately 82,000 childless adults up to 100 percent FPL. Oklahoma is participating in the federally facilitated Marketplace, and did not elect to expand Medicaid under the ACA. In September 2013, the state was issued an 1115 Medicaid waiver which modifies eligibility for “Insure Oklahoma,” a program in place since 2005, to include the population between Medicaid and the Marketplace subsidies. Previously, Insure Oklahoma served as a Medicaid premium assistance program for 30,000 low income workers, providing individual policies and coverage purchased through small employers. Arkansas had an 1115 Medicaid waiver approved in September 2013 to allow the state to use Medicaid funds to purchase coverage in the private market through the state Marketplace for a newly eligible category of recipients, including adults with incomes under 138 percent FPL. The demonstration, which has been approved for three years, will cover an estimated 225,000 newly eligible individuals. 3 of 4 Center for Mississippi Health Policy � Issue Brief: Coverage Options—For Mississippians After Implementation of the ACA � JANUARY 2014 Additional Information For more detailed information on health insurance coverage in Mississippi, Health Insurance Exchanges, or Medicaid Expansion, please see the Center’s issue briefs, fact sheet, and chart books on these topics. issue brief issue brief MEDICAID EXPANSION BUILDING MISSISSIPPI’S An Overview of Potential Impacts in Mississippi HEALTH INSURANCE EXCHANGE Winter 2012 Update PUBLISHED NOVEMBER 2012 PUBLISHED JANUARY 2012 The U.S. Supreme Court’s June 2012 decision that upheld the Affordable Care Legislation to create a Health Insurance Exchange has been proposed in Act (ACA) struck down a portion of the law that made continued federal Mississippi for several years. Through the federal Affordable Care Act (ACA), Medicaid funding contingent on a state’s participation in expanding Medicaid grants have been made available to states to develop state-based Exchanges, eligibility. States now have the option of deciding whether or not to implement alternatives to a federally run Exchange. This issue brief summarizes a report by the expansion. This brief provides background information on the program and the Center on the current status of Mississippi’s Exchange. outlines policy considerations associated with the potential expansion. Medicaid is a cooperative federal and state effort to provide health benefits to What is a “Health Insurance Exchange”? certain low-income subsets of the population. In order to receive federal funding for 133% OR 138%? Exchanges are intended to: Federal law provides for the expansion of Medicaid Medicaid, states are required to cover certain groups. Optional federal funding is to all individuals whose income is at or below 133% made available for covering other groups. Title XIX of the Social Security Act, which Provide for greater choice and value for individuals and small businesses FPL. Because the law also includes a 5% “income serves as Medicaid’s federal mandate, lists over 50 potentially eligible population that need to purchase health insurance disregard,” the effective limit is 138% FPL. groups. Present information about health plans in a standardized and simplified Currently, individuals who qualify for Medicaid must meet both financial and way to assist consumers in decision-making ANNUAL INCOMES ASSOCIATED WITH categorical requirements. In other words, a recipient must not just be poor, but also 2012 FEDERAL POVERTY PERCENTAGES Facilitate enrollment in both public and private health insurance benefit elderly, disabled, pregnant, a child, or a parent of a minor child. The ACA attempted programs % FEDERAL POVERTY SINGLE FAMILY to remove the categorical restrictions on Medicaid, and limit eligibility to financial LEVEL OF FOUR status (at or below 133% of the federal poverty level (FPL), plus a 5% income The proposed regulations released by the United States Department of Health and 24% $2,681 $5,532 disregard) regardless of other circumstances. As illustrated in Figure 1, the newly Human Services (HHS) in July 2011 outlined broad requirements for Exchange eligible group would consist primarily of low-income working age adults (19 – 64). implementation and operation. There are two types of Exchanges: one for 44% $4,915 $10,142 individuals seeking to purchase individual and family health insurance coverage, States can provide a different set of benefits for the newly eligible population, and one for small businesses known as the “Small Business Health Options 100% $11,170 $23,050 mirroring a “benchmark” benefit package, such as the coverage provided to state Program” (SHOP). Mississippi can choose to operate these entities separately, or or federal employees. These benefits may not be as comprehensive as traditional to combine the markets into one COVERAGE PROJECTED FOR MISSISSIPPI 138% $15,415 $31,809 SHIFTS IN Exchange with shared administration, overhead, Medicaid coverage. and risk pool. 185% $20,665 $42,643 FIGURE 1. MEDICAID ELIGIBILITY (NON-ELDERLY), PRE AND POST ACA Before ACA Implementation After ACA Implementation Source: The poverty guidelines updated periodically in SHIFTS IN COVERAGE PROJECTED FOR MISSISSIPPI the Federal Register by the U.S. Department of Health and Current Post-2014 Post-2014 Before ACA Implementation After ACA Implementation Human Services under the authority of 42 USC 9002(2). Current Federal Mississippi Federal Optional Groups Approximately 434,500 Mississippians Uninsured Requirements Eligibility Levels Requirements Expansion Other aged 19-64 were without health insurance in 2010. 4% 7% Pregnant Women Up to 133% FPL Up to 185% FPL Up to 185% FPL* Up to 185% FPL Depending on their income, some of these individuals Exchange may be eligible for premium tax credits 11% Uninsured Infants (< 1 year) Up to 133% FPL Up to 185% FPL Up to 185% FPL Up to 185%FPL to lower the cost of insurance purchased through 20% the Exchange. Exchange 0% Children (1 - 5 years) Up to 133% FPL Up to 133%FPL Up to 133% FPL Other Employer Medicaid/ Up to 133% FPL 5% 48% CHIP Children (6 - 18 years) Up to 100% FPL Up to 100% FPL Up to 133% FPL 32% Employer Working Low-income Parents Up to 24% FPL Up to 44% FPL Up to 24% FPL** Medicaid/ 45% CHIP Non-working Low-income Parents Up to 24% FPL Up to 24% FPL Up to 24% FPL** 22% For the most part, other Medicaid eligibility categories (such as working individuals with disabilities, individuals eligible for Childless Adults (19 - 64 years) None None None Individual Individual Social Security Insurance (SSI), and Medicare buy-in groups) Private Private are not affected by the potential expansion, because their * 133% FPL or “such higher income standard up to 185% FPL, if any, as the State had established as of December 19, 1989 for determining 5% 1% financial requirements are each set near or above 133% FPL. eligibility for pregnant women, or as of July 1, 1989, had authorizing legislation to do so.” (77 Fed. Reg. 17205. March 23, 2012). Source: An Overview of Health Reform (2010). Center for Mississippi Health Policy and Georgia Health Policy Center. Retrieved from: Mississippi children up to 200% FPL are eligible for coverage ** “The minimum income standard is a State’s AFDC income standard in effect as of May 1, 1988 for the applicable family size.” (77 Fed. Reg. http://www.mshealthpolicy.com/documents/MSOverviewFinal_PRINT.pdf for Mississippi Health Policy and Georgia Health Policy Center. Source: An Overview of Health Reform. (2010). Center under the Children’s Health Insurance Program (CHIP). 17204. March 23, 2012). Retrieved from: http://www.mshealthpolicy.com/documents/MSOverviewFinal_PRINT.pdf 1 of 4 1 of 2 Center for Mississippi Health Policy � Brief: Medicaid Expansion —An Overview of Potential Impacts in Mississippi � NOVEMBER 2012 Center for Mississippi Health Policy � Brief: Building Mississippi’s Health Insurance Exchange —Winter 2012 Update � JANUARY 2012 fact sheet UNINSURED ADULTS Mississippi County-Level Data PUBLISHED OCTOBER 2013 This fact sheet presents the number and percentage of non-elderly uninsured adults at the county level in Mississippi, highlighting groups who may be eligible for premium subsidies through a Health Insurance Exchange or coverage through the expansion of Medicaid authorized under the Affordable Care Act (ACA). The ACA provides for premium tax credits for persons with household incomes between 100 percent and 400 percent of the federal poverty level (FPL) and gives states the option to expand Medicaid to persons with NON-ELDERLY ADULTS household incomes up to 138 percent FPL, beginning in 2014. All data are “Adults” as used in this document refers to non-elderly adults 18 - 64 years of age. from the 2011 Small Area Health Insurance Estimates (SAHIE), United States Census Bureau. UNINSURANCE RATE UNINSURANCE RATE ADULTS UNDER 400% FPL ADULTS UNDER 138% FPL INCOMES ASSOCIATED WITH 2013 FEDERAL POVERTY PERCENTAGES % FEDERAL POVERTY FAMILY LEVEL SINGLE OF FOUR 138% $15,976 $32,745 400% $45,960 $94,200 Source: The poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 USC 9002(2). < 30% < 40% 30% - 32% 40% - 43% 32.1% - 34% 43.1% - 46% > 34% > 46% Source: Small Area Health Insurance Estimates (SAHIE). (2012). U.S. Census Bureau. 1 of 4 Center for Mississippi Health Policy � Fact Sheet: UNINSURED ADULTS—Mississippi County-Level Data � OCTOBER 2013 References Kaiser Family Foundation. (October 2013). States decisions about the Medicaid expansion as of October 22, 2013. Based on data from the Centers for Medicare and Medicaid Services. Retrieved from: http://medicaid.gov/AffordableCareAct/Medicaid- Moving-Forward-2014/Medicaid-and-CHIP-Eligibility-Levels/ medicaid-chip-eligibility-levels.html Kaiser Family Foundation. (2013). State decisions for creating health insurance marketplaces. Retrieved from: http://kff.org/ health-reform/state-indicator/health-insurance-exchanges/ Center for Mississippi Health Policy. (January 2014). Health coverage for Mississippi adults 19-64 years of age: An analysis of 2012 American Communities Survey and 2012 Medical Expenditures Panel Survey Data. Available at: http://www. mshealthpolicy.com/health-insurance-coverage-in-mississippi/ 45 CFR 155.605(g)(5) Plaza Building, Suite 700 Wisconsin Department of Health Services. (November 2013). BaderCare Plus Demonstration Project Waiver Request. 120 N. Congress Street Retrieved from: http://www.dhs.wisconsin.gov/aboutdhs/initia- tives/budget/initiatives/er/index.htm Jackson, MS 39201 Centers for Medicare and Medicaid Services. (January 2014). Waivers. Retrieved from: http://www.medicaid.gov/Medicaid- Phone 601.709.2133 CHIP-Program-Information/By-Topics/Waivers/Waivers.html Kaiser Family Foundation. (December 2013). Medicaid Fax 601.709.2134 expansion through premium assistance: Arkansas, Iowa, and Pennsylvania’s proposals compared. Retrieved from: http://kff. org/health-reform/fact-sheet/medicaid-expansion-through-premi- www.mshealthpolicy.com um-assistance-arkansas-and-iowas-section-1115-demonstration- waiver-applications-compared/ 4 of 4 Center for Mississippi Health Policy � Issue Brief: Coverage Options—For Mississippians After Implementation of the ACA � JANUARY 2014