In 2011 the Arkansas General Assembly voted to expand Medicaid under the Affordable Care Act (ACA) for those who make 138% of the Federal Poverty Level (FPL), which is $16,394 for an individual and $33,534 for a family of four. In the Private Option, renamed Arkansas Works, the state takes the Medicaid dollars provided under the ACA to purchase insurance policies, pay the co-pays and the deductibles so that medical costs are paid at 100% for eligible individuals between the ages of 18-64 years of age. The current average premium cost is $532.11/month.
It was predicted that the maximum number enrolled in the Private Option wouldn’t exceed 250,000. However, at the end of 2016, there were 331,000 enrolled in Arkansas Works, aka Private Option. There are 22,977 who are covered under the traditional Medicaid fee-for-service model because they need medical services that insurance doesn’t cover. The annual costs to the taxpayer for the Arkansas Works program has been $774 million in 2014, $1.2 billion in 2015, and $1.5 billion in 2016.
Most Arkansans on Arkansas Works are healthy – they never go to the doctor, to a clinic or to a hospital. The state is paying for policies that are never used – money that could be going to those who are truly in need of medical assistance. A government health care program based solely on income level and not medical need will not work. I got a real education this past week in how all this works.
My brother has several severe medical problems the most severe being that his body continuously produces squamous skin cancers and compounding this he has Type II diabetes. He is currently on Arkansas Works, which has literally been a lifesaver given his medical problems and the fact that he had to undergo quadruple bypass surgery a year ago. He is taking an oral chemo drug 10 days a month for his cancer as well as his medications for his diabetes. His average drug costs per month is $7,550. Periodically, he must undergo another surgery to remove skin cancers. I’ve lost count of how many he’s had over the past two years. Bottom line: without his medications, he will die.
He started a new job this past January, but because he barely makes over 138% of the FPL, he is no longer eligible for Arkansas Works. Governor Asa Hutchinson is asking for a waiver to lower the income eligibility to 100% FPL to “encourage personal responsibility” and through a work requirement “help individuals work up the economic ladder” and to “move them over to the exchange”.
My brother is trying to be personally responsible and would like nothing more than to work up the economic ladder and pay his own way, but when you have the severe medical conditions that he has, it’s virtually impossible.
Let’s play this scenario out. He now must go out to the exchange to purchase an “affordable” plan so he can get his medical costs covered. On his current salary, he can only afford a Bronze plan, which is a 60/40 co-insurance (insurance pays 60%, he pays 40%), but only after he meets a $6,300 deductible. The Bronze plan premium is $250/month. If you annualize the premium and add in the deductible, he must spend $9,300 out of his own pocket before one dime of insurance is paid.
What does insurance pay? Sixty percent of his $7,550/month medical drug costs at $4,530/month leaving him to pay $3,020/month out of his own pocket. Total annual costs out of his pocket is $45,000/year. I wouldn’t call this affordable.
So, what are his options to stay on Arkansas Works? Quit his job and find a job that pays below $16,394/year? How is that climbing the economic ladder? His other option is to quit working entirely, apply for HUD housing and Social Security Income, which is $736/month, but he gets to keep his health insurance. He wants to work because he wants some dignity to pay his way. He just needs help with his medical costs until he can climb that economic ladder. This is how government keeps citizens enslaved – by making impossible rules that have no relation to real life and does nothing to help a person get out of poverty. In my brother’s case, his medical costs are keeping him impoverished.
Medicaid was created to help those who need the help, not to cover healthy persons on a private insurance policy that is 100% paid by the government as well as their co-pays and deductibles. Since government is in the health care business and arbitrarily sets the rules based on income, people will fall through the cracks and some of them will die. One of them could be my brother.
The ACA is failing not only because of escalating premiums and increasing deductibles. It’s failing because people are only dollar signs now. After all the government has “limited resources” and must put a value on human life. Has it really come down to the almighty dollar? Is this who we are as a society?
(Jacque Martin contributes ‘Just to the Right’ each month for The Sun Times.)