By Kathy Ruben
With the Affordable Care Act under assault in Washington, D.C., there’s an urgent need in Annapolis for lawmakers to respond. Without concerted and forward-looking action by the General Assembly, more and more Marylanders will be forced out of affordable health insurance coverage.
A reinsurance program and an individual mandate are both under consideration and if appropriately designed and passed, can help lower premiums.
But we need to do more – and think long-term about how to improve insurance competition, expand choices and bring down costs for people struggling to afford insurance. We can begin by passing a bill that could lead to Marylanders being allowed to “buy in” to the Medicaid program.
A Medicaid buy-in holds promise to help those struggling the most: middle-class Marylanders – including small business owners – who are increasingly unable to afford ever-climbing premiums and out-of-pocket costs.
Many Marylanders who must buy insurance on the individual market – that is, those not covered through work – can receive a premium subsidy from the federal government. But those subsidies only help individuals earning less than $48,240 or $98,400 for a family of four. Those earning more are working people who are often self-employed – and they must shoulder their entire premium costs.
Those premiums soared in Maryland by as much as 57.7 percent, coming on top of last year’s increases. For a 40-year-old in Montgomery County, the premium for a basic policy (with high deductibles) is $600 a month. For a 60-year-old, the rates range from $1,273 to $1,625 per month. Add a spouse or dependents and the premiums go even higher.
The individual insurance market in Maryland has also gotten less competitive. Today, residents of 13 Maryland counties and parts of three others have only one insurance carrier option. Less competition contributes to higher premiums, and consumers lose out on affordability and choice.
These discouraging trends mean that some people must go without vital health care coverage that could now cost them more than their mortgage. During the most recent open enrollment period, the number of people enrolling in private insurance plans dropped by 2.6 percent – from 157,637 the previous year to 153,571.
Among those who are struggling are entrepreneurs. The Affordable Care Act gave many Marylanders the ability to leave jobs they had relied on for insurance – and open new businesses. A 62-year-old Annapolis small business owner was among the many Marylanders who were priced out of insurance.
“After a lifetime of being covered by employer-provided health insurance, I opened my own business two years ago and began purchasing private insurance through the ACA,” she wrote to state insurance regulators. “The proposed increase is as high as 57 percent. I simply will not do it. I will hope that I do not have a catastrophic injury or illness before I am eligible for Medicare in three years. I cannot even begin to tell you how much anxiety and stress this situation is causing me.”
The pending Medicaid buy-in legislation, promoted by Consumer Health First and supported by other health care advocates, would establish a task force of health care providers, insurers, policy experts and consumers to examine the options, including the potential for access to the Medicaid program, to increase affordability and consumer choice. They will provide their recommendations to the General Assembly and governor by the end of the year.
Medicaid, which is jointly funded by the federal and state governments, now covers low- and middle-income people, many of whom hold jobs; children; people with disabilities; and seniors. It plays a vital role by insuring one in five Marylanders, including one in four children. The task force will be charged with examining the benefits and costs of a Medicaid buy-in.
Establishing a Medicaid buy-in would be complex. But, this is an idea that could truly help those who cannot now afford health insurance.
A second piece of legislation is also critically needed; it would strengthen the state’s premium rate review process, which would help us enact policies to bring down costs.
Thanks to the Affordable Care Act, the uninsured rate in Maryland dropped from 12.3 percent in 2013 to 6.1 percent today. We should all be encouraged by this progress.
But, the past year has made clear that we need to do more to stabilize health insurance markets and lower rates, increase competition and make sure that everyone can access vital health care services. This must include those Marylanders who purchase their own insurance.
Kathy Ruben is executive director of Consumer Health First, a statewide alliance of individuals and organizations seeking solutions that promote health equity.