Gov. Brian Kemp’s effort to chart a unique path to healthcare reform for Georgia has found criticism on both sides of the political aisle. To borrow a phrase from my newspapering days, he must be doing something right.
Kemp wants permission from the federal government to change two things: Medicaid for the working poor, and federal subsidies for plans bought on the private insurance exchange established by the Affordable Care Act. There’s a great deal of room for improvement for each, and innovation by the state is the only good and realistic option for fixing either.
I use the words “good” and “realistic” advisedly. The left’s alternative, a full-blown Medicaid expansion in Georgia followed by some version of “Medicare for All” nationally, is not good. And the right’s preference, to repeal the ACA, is no longer realistic.
Let’s set Medicare for All aside for today and focus on what Georgia can do. Democrats want to expand Medicaid to all Georgians who earn up to 138 percent of the federal poverty level, which this year amounts to about $17,236 for a single adult. That’s the ceiling allowed by the ACA.
Kemp wants to limit it to 100 percent of the poverty level, which is $12,490 for an individual. That’s a better approach for a few reasons.
First, those earning between 100 and 138 percent of the poverty level aren’t left out; they already can buy heavily subsidized insurance on the exchange. If you don’t think that coverage is ideal or even sufficient, well, we agree – which is why the other part of the plan is to broaden the choices available on the exchange and reduce both premiums and out-of-pocket costs.
What’s more, a large chunk of the Georgians who would become eligible for Medicaid under a full expansion already have private coverage. A study last year by the Urban Institute indicated this would be true for about a quarter-million Georgians, or 1 in 3 potential new Medicaid recipients.
It’s important not to move that group to Medicaid, and not only because it would cost taxpayers more. The private insurance available on the exchange typically offers better access to care than Medicaid, which isn’t accepted by many doctors in Georgia. Having an insurance card in your wallet doesn’t do much good if you can’t find a doctor who will take it.
Now, what about criticism from the right? It mostly comes from some Republicans who don’t want to see anyone at all added to Medicaid.
Reforming the private exchange without addressing those below the poverty line is about as unrealistic at this point as repealing the ACA. Politics isn’t the only reason.
The subsidies for exchange plans aren’t going away. But they can be used more wisely. That means letting people use their subsidies to buy less comprehensive coverage if they want, and encouraging them to shop around by allowing any unspent funds to be used for out-of-pocket expenses or saved for an emergency.
Wiser and more flexible use, however, can only go so far. All indications from Washington are that the subsidies can’t go to those below the poverty line. They can only receive Medicaid funds.
What those Medicaid funds buy, however, could be the same as what the subsidies buy. If Georgia can create a more vibrant and competitive private insurance market on the exchange, denying the poor the use of their Medicaid dollars for those private plans would be folly. Keeping someone just below the poverty line on Medicaid would mean a complete change of coverage, with all the disruption that brings, if she got a raise and moved just above the line. (This would also be true if Georgia were to simply expand Medicaid, as Democrats want.)
Such a scenario could make her less likely to take the raise. That might be rational for her in the short run, but creating such a system is shortsighted of the rest of us in the long run.
• Kyle Wingfield is president and CEO of the Georgia Public Policy Foundation. Contact him through the group’s website at www.georgiapolicy.org.