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Why the ACA Hasn’t Solved all Healthcare Woes

Virginia saw the defeat of the Medicaid expansion movement for this year which has led to a large number of newspaper and web published articles looking at the uninsured and their choices for healthcare coverage through the Affordable Care Act (ACA). What is more disturbing is that these articles are painting the ACA in the light that it is the solution. In some cases the ACA does in fact provide insurance to persons and families who need it, and can utilize it. However what we are starting to find is a worrying trend of families who are ACA eligible and/or enrolled but are unable to afford it in the long run as they attempt to pay their deductibles, let alone the monthly co-payment. These families can no longer turn to the free clinic system in Virginia as many free clinics cannot accept patients with insurance.

The Numbers

  • Approximately 32% of Virginia’s population or 2,492,300 people live at or below 200% of the Federal Poverty Level (FPL) (KFF 2012).
    • There are, as of 2014, 1.02 million uninsured, non-elderly, Virginian’s, of which 191,000 or ≈19% of the uninsured fall into the potentially eligible medical coverage gap from the lack of Medicaid, as do 14% of undocumented immigrants (KFF 2014).
  • Taking out the combined 43% who aren’t ACA eligible we are left with a population of 2.05 million Virginians who have ACA or are ACA eligible but can’t afford it (Ibid.).

infographic

 

Cost of Living

For a family of four who makes 200% of the Federal Poverty Level (FPL) they have to live on less than $47,700 a year or $3,975 a month (RI DHS 2014).  At a little more than half of the required amount “to secure an adequate but modest living standard” as defined by the Economic Policy Institute requires families to struggle and make tough choices just to survive (Gould 2013, 1).

 

Annual Monthly Costs in NoVA for a Family of Four
Two Adults, Two Children–under the age of 10
Housing $1,412
Food $754
Child Care $1,716
Transportation $607
Health Care[3] —-
Other Necessities $554
Taxes $850
Monthly Total $5,893
Annual Total(Gould et al. 2013). $70,719

[3]EPI has not updated these numbers to reflect ACA prices. Their methodology for determining the monthly average is incorrect post ACA.

Across the U.S. different states address disadvantaged family’s needs through various state provided support networks. However Virginia is a particularly tough state to live in and receive sponsored support, especially with the Medicaid expansion originally envisioned in the ACA roll-out continually being stopped from moving forward (Vozzella 2014, par. 6; KFF 2013).  A family of four living on $47,700 can only expect to receive $355 a month in food stamps (SNAP) and Medicaid/CHIP coverage for their kids. When looking at their own healthcare they are facing an incredibly different situation.

State Provided Support
Housing Is Section 8 Eligible—though incredibly hard to get
Food Family in this situation is tentatively eligible for $355/month[1] (ND DHS 2013).
Health Care Medicaid/CHIP for the children, and a $264 tax credit

[1] This number was based off of a calculator from North Dakota, but is an adequate representation of the average amount of SNAP disbursed for a family of four in Virginia.

Of 10 ACA ‘bronze level’ plans surveyed for coverage for the parents, it was determined that the average plan would cost $6,225 individually or $12,630 per family (Healthcare.gov 2014).  These numbers are the out of pocket maximum’s which include the monthly premiums as well as any co-pays or money put towards the deductible (Ibid). All of the plans surveyed with the exception of one plan’s pharmaceutical co-pay required co-pays only after the deductible had been met (Ibid).

The average healthy household is expected to pay $3,300 a year out of pocket for total medical expenses (Buttell 2014, par. 3). The average an individual patient who has one of the five most common chronic diseases (asthma, cancer, diabetes, heart disease, or stroke) expects to pay out of pocket, per year, a little more than $6,000 (Thorpe 2014, par. 11). Almost double the expected out of pocket costs than that of the healthy family. Unfortunately low income individuals or families are more likely to be sick and have a chronic disease than their richer counterparts (L’Ecluse 2009, par 2). The family living at 200% of FPL and has an ACA insurance plan can no longer go to the free clinics, and cannot afford their healthcare. They have fallen into an insurance gap where they have nowhere to turn for help.

Average Cost of 10 Bronze Level ACA Plans
Monthly Premium(after tax credit[2]) $144.80
Individual Deductible $5,185
Family Deductible $10,370
Out of Pocket Max Individual $6,225
Out of Pocket Max  Family $12,630
Primary Co-Pay(after deductible) $34
Specialist Co-Pay(after deductible) $43.75
Pharmaceutical Co-Pay(after deductible) $10 or 18% of the drug price

[2] This price is assumed after an average of $453 tax credit. Average was derived from 10 ‘bronze level’ plans.

Don’t believe me? Read this article published in Forbes: http://www.forbes.com/sites/johnlechleiter/2014/07/30/the-unfinished-business-of-health-care-reform-real-access-to-innovative-medicines/

References

Buttell, Amy E. 2014. Paying out-of-pocket health care costs. Bankrate. http://www.bankrate.com/finance/insurance/coping-with-out-of-pocket-health-care-cost-1.aspx (accessed July 7, 2014).

Gould, Elise, Nicholas Finio, Natalie Sabadish, and Hilary Wething. 2013. 2013 Family budget calculator: Technical documentation. Economic Policy Institute 297, (July). http://www.epi.org/resources/budget/ (accessed June 23, 2014).

HealthCare.Gov. 2014. 45 Health plans. https://www.healthcare.gov/find-premium-estimates/#results/&aud=indv&type=med&state=VA&county=Fairfax&age0=35&age1=35&employerCoverage=no&householdSize=4&income=47700 (accessed June 20, 2014).

L’Ecluse, Kathleen. 2009. Poor people are sick more, get less health care. The Examiner. http://www.examiner.com/article/poor-people-are-sick-more-get-less-health-care (accessed July 7, 2014).

ND Department of Human Services (ND DHS). 2014. Supplemental Assistance Program Benefit Computation Sheet. http://www.ndhealth.gov/dhs/foodstampcalc.asp (accessed June 26, 2014).

RI Department of Human Services (RI DHS). 2014. 2014 Federal poverty level (FPL) guidelines by family size. http://www.dhs.ri.gov/Portals/0/Uploads/Documents/Public/General%20DHS/FPL.pdf (accessed Jul 3, 2014).

The Henry J. Kaiser Family Foundation (KFF). 2014. How will the uninsured in Virginia fare under the Affordable Care Act? http://kff.org/health-reform/fact-sheet/state-profiles-uninsured-under-aca-virginia/ (accessed June 30, 2014).

_____. 2013. Visualizing health policy: Medicaid expansion under the Affordable Care Act. http://kff.org/infographic/visualizing-health-policy-medicaid-expansion-under-the-affordable-care-act/ (accessed June 30, 2014).

_____. 2012. Distribution of the total population by federal poverty level (above and below 200% FPL). http://kff.org/other/state-indicator/population-up-to-200-fpl/ (accessed June 30, 2014).

Thorpe, Ken. 2014. About the crisis. Partnership to Fight Chronic Disease. http://www.fightchronicdisease.org/facing-issues/about-crisis (accessed July 2, 2014).

Vozzella, Laura. 2014. In Virginia, Medicaid expansion fight escalates. The Washington Post, (June). http://www.washingtonpost.com/local/virginia-politics/va-house-republicans-tout-report-saying-medicaid-expansion-is-a-legislative-decision/2014/06/25/b8ede384-fc78-11e3-932c-0a55b81f48ce_story.html (accessed June 30, 2014).