Medicaid Estate Recovery imposed on Medicaid enrollees
Andrew writes on healthcare, mostly the PPACA plan and the various metal plans, and the latest gig (ARPA) resulting in lower costs for anyone under 250% FPL and lower costs for anyone higher than 400% FPL.
All made possible due to Biden and Democrat’s American Rescue Plan Act of 2021. It will expire EOY 2022 and I doubt Manchin will help with it. Without it and other aid, This all could have been a 2008 Redux. Mostly, what you will catch me writing about is prices versus costs. How can you set a price or accept one if you do not know costs? The same applies to healthcare. Eighteen percent of GDP appears to be kind of high. . .
“John Roberts, James Joyce, the individual mandate, Medicaid Estate Recovery, and “affordable” care“
Andrew Sprung, XPOSTFACTOID, May 9, 2022
So it was that I caught one lightning round of associations at lunchtime today:
— John Roberts — trying to moderate Roe strike-down?
— Roberts — headed off one radical conservative decision by saving the ACA’s individual mandate “as a tax.”
— The mandate — justifiable? — if insurance were truly affordable for all, but under the ACA as written, it wasn’t.*
— RBG: mocking Scalia’s broccoli horrible — mandates to buy all kinds of stuff…
— mandating that people buy private insurance — ok?
— not always private — the mandate could land you in Medicaid. Public! Free!
— But… Medicaid Estate Recovery! — for applicants over age 55 in 20-plus states, the mandated coverage is a long-term loan…
And there I was brought up short by an actual thought. I have written before or several times, Medicaid Estate Recovery imposed on Medicaid enrollees not in long-term care undermines the ACA’s promise of “affordable” care — and the mandate to obtain it. What struck me, as I enter the marketplace myself — is no one is threatening to come after my estate for the gargantuan subsidy which my wife and I are getting. Medicaid is cheaper than marketplace coverage. In 20-plus states, people over 55 accessing it (or rather, their heirs) are ultimately on the hook for paying back premiums from the government. In New Jersey, an adult made eligible for Medicaid by the ACA costs the state and federal government $416 per month (in 2019). My wife and I will cost the feds $700/month or so. We get the benefit free and clear; the Medicaid enrollee’s children may have to pay the state back after the enrollee’s death.
Put another way, if you’re over age 55, lack access to other insurance and earn $17,775 per year, under the ARPA subsidy schedule you qualify free silver marketplace coverage with Cost Sharing Reduction that bumps the actuarial value to 94%.
If you earn, $17,773, you get Medicaid — also free, but with an effective lien on it. ???
That’s ridiculous. One generation’s legislative priority was to avoid giving people with assets free long-term care (though estate recovery most commonly falls on low income people). So the 1993 omnibus budget package required states to recover from the estates of those whose long-term care was funded by Medicaid. That 3rd Way legislative aim ran smack dab into the next generation’s intent: to make affordable health coverage available to all non-seniors. States, given the option to extend Medicaid Estate Recovery to all enrollees over age 55, most often opted for the extra revenue opportunity. Thus, “affordable” coverage is a long-term loan for a significant subset of near-elderly beneficiaries of the ACA Medicaid expansion, or other pathways to Medicaid eligibility.
Okay, it’s not a new thought. It’s the same obvious injustice. But the stark contrast with the way marketplace coverage — more wasteful, more expensive, available only at higher incomes — is granted struck me afresh.—
* I somehow skirted the usual follow-on thought: the ARPA subsidy boosts brought the ACA a lot closer to living up to its name, and it will be policy disaster and political suicide if Democrats fail to extend them.
You are right- that is ridiculous.
One question- when you say an adult made eligible for Medicaid costs the government(s) $416 per month- that is an average of costs right? I mean this isn’t like a private insurance plan where you might pay $950 per month in premiums, whether or not you were sick or received care. In other words, if you were in the Medicaid plan and were not sick or go to a doctor that year- is it fair to say that your eligibility for the program cost $416 per month to anyone?
Anyhow… the federal government is paying quite a bit more than $416 dollars every month to Anthem Blue Cross to subsidize my ACA health care insurance plan. And that is whether or not I get sick or go to the hospital. If I was on medicaid, the government might have paid out less than $10,000 in total over the last 5 years to directly pay for health care I received. Instead, they have paid Blue Cross at least $30,000 to subsidize my insurance and I have paid at least $15,000 in premiums and copayments in addition.
The stupidity of our health insurance system is mind-boggling.
No it would not be fair to say that individuals in different states costs are the same. Different geographical locations have different pricing as provided by commercial healthcare insurance companies. “In New Jersey, an adult made eligible for Medicaid by the ACA costs the state and federal government $416 per month.” That is solely in NJ for Medicaid not the ACA insurance programs. Also newly eligible adults.
Thanks run. But my question was a little different from the question your answer answered. Let me rephrase the question. If someone becomes eligible for Medicaid, (or Medicare) does that mean that the government automatically will be paying some extra fixed cost for that person’s health care? Because I think the answer is no- medicaid pays depending on actual usage of services delivered by health care providers to each individual. As far as I know. And I was asking if I was correct in that assumption.
For those states which expanded under the ACA, eventually (decreasing from 100%) 90% of all of the costs are funded by the Feds. Pre-ACA, I believe the limit was 50% funded by the Feds. If people go on Medicaid and they expanded under the ACA, to my knowledge, the commercial insurance plan is paid a premium. and then it can be FFS or Managed Care.
I think this is what you are asking me.