Living life as one of the uninsured
Tim Messenger has worked hard all his life – most recently as inventory manager for a Gaston County car dealer. He was laid off in January 2014, just as the bank foreclosed on his house and his divorce became final.
While looking for work, he lived in his car for 10 weeks. After two traffic accidents in 2015, related to poor vision brought on by undiagnosed diabetes, he lost the vehicle that was his home.
Without health insurance, Messenger got medical care from a free clinic and medicines from a free pharmacy in Charlotte. Now 56, he’d rather pay his own way, but his vision has worsened, he can’t drive and he can’t work. “Your safety net can just kind of get knocked out from under you,” he said.
Messenger is one of about 300,000 North Carolina residents who remain uninsured because they fall into the so-called “Medicaid gap.”
The gap grew out of the decision three years ago by Gov. Pat McCrory and the Republican-led legislature not to expand Medicaid under the Affordable Care Act. Despite the federal government’s promise to pay most of the expansion cost, state leaders fear North Carolina could get stuck with the massive new expense, and they say the existing Medicaid program – the government health program for low-income and disabled citizens – should be reformed first, to control costs.
This fall, as McCrory and his Democratic opponent, Attorney General Roy Cooper, face off in a close gubernatorial race, what to do about Medicaid is one of the many policy questions on which they have very different views. The winner’s approach will have consequences for some of the state’s most vulnerable people.
As part of an assessment of how the state is doing on several fronts heading into the Nov. 8 election, the Observer and The News & Observer in Raleigh examined five key measures of health for North Carolina, and how they stack up to other states. The papers analyzed data about infant mortality, obesity, lack of health insurance, primary care physicians and overall health.
North Carolina is below the median but has risen five places since 1990 in a ranking of states’ overall health, compiled by United Health Foundation, based on an analysis of behavior, community and environmental conditions, policies and clinical care data.
The state’s increase in the obesity rate has slowed recently, bringing it almost even with the national average. There has been a slow reduction in infant mortality, following a national trend, but the state still trails the U.S. average. And as for primary care doctors per 100,000 people, the state is below the national average despite slight gains across the board in the past 10 years.
Finally, North Carolina’s percentage of people without health coverage, once better than the U.S. average, is now more than two points worse.
That statistic is related to the state’s decision not to expand Medicaid. States that chose to expand saw a 42 percent drop in their uninsured rates from 2013 to 2015. In North Carolina, the drop was 28 percent. About 13 percent of non-elderly adults in the state remain uninsured, compared with 10 percent nationwide.
When Congress passed the Affordable Care Act – dubbed Obamacare – the law called for covering most impoverished citizens by expanding Medicaid in all states. But two years later, the U.S. Supreme Court made that provision optional for the states.
North Carolina and South Carolina are among 19 states – most led by Republicans – that decided not to expand Medicaid, leaving the poorest of the poor – like Messenger – with few options for health care.
McCrory calls Obamacare “an unmitigated disaster for North Carolina families and small business” and hasn’t pushed for Medicaid expansion. The state’s existing Medicaid program has “consistently overspent its budget by billions of dollars” and should be reformed before it’s expanded, he said. Legislators passed a reform bill last year, but the state is awaiting federal permission to change the way doctors and hospitals are paid to care for Medicaid patients. It will be three to four years before the changes take effect.
Cooper backs Medicaid expansion, calling it “inexcusable that Governor McCrory has refused federal dollars” to provide more coverage to low-income residents. Like other supporters of expansion, he said it will “provide a much-needed shot in the arm for our economy” by producing new jobs, preventing rural hospital closures and helping to keep insurance premiums lower.
Opinion split on ACA
Like McCrory, many Americans believe the ACA has been a failure. Republicans in Congress have called for its repeal more than 60 times.
But since the law took effect, about 20 million uninsured Americans have gained health insurance. And in North Carolina, the online marketplace has been popular since it opened in 2013. The state’s ACA enrollment surpassed 545,000 people this year, the fourth-highest in the country.
Still, signs of distress are increasing. Citing huge losses on ACA business, UnitedHealthcare and Aetna have pulled out of the online marketplace in North Carolina for 2017.
That leaves Blue Cross and Blue Shield of North Carolina, the state’s largest insurer, as the only one selling ACA policies in all 100 counties. Blue Cross also has reported losses – $405 million on ACA marketplace plans in 2014 and 2015 – and was, until recently, waffling about the future.
Last month, Blue Cross announced it will continue offering marketplace plans next year. But the decision will come with a cost.
Blue Cross received an average 32.5 percent rate increase – one of the highest in the country – from the N.C. Department of Insurance for 2016. For next year, the insurer had already requested an 18.8 percent increase, which has been revised since the withdrawal by Aetna and UnitedHealthcare. A decision by the insurance department is expected by Oct. 28.
Skyrocketing premiums are one of the problems cited by ACA critics. But one recent study concluded that rejecting Medicaid expansion could play a role in premium hikes.
Premiums for marketplace plans were 7 percent lower in states that expanded Medicaid, according to an August report from the federal Department of Health and Human Services. In other words, Medicaid expansion not only could provide insurance for more low-income people, it might also reduce the rise in premiums for middle-income citizens who shop for insurance at www.healthcare.gov.
Rachel Garfield, a senior researcher for the nonpartisan Kaiser Family Foundation, said that single study isn’t “the most rock solid evidence” that Medicaid expansion would help lower premiums. “It’s possible that there are other things affecting those results,” she said. “More research needs to be done to say definitively what’s going on.”
But Garfield added that “a very large body of research” shows that expanding Medicaid to low-income people would provide greater access to medical care and medicines, which could mean better health in the long run. “Having Medicaid is much better than being uninsured,” Garfield said.
Barriers to care
Studies show that not having insurance creates barriers that make it hard for people to get medical care when they need it.
“People delay getting care they need,” said Pam Silberman, a professor of health policy and management at UNC Chapel Hill. “Sometimes they don’t get care at all.…Then they end up in the hospital, sicker than they needed to be if they had gotten the care when they first needed it.”
Doctors who treat poor and uninsured patients see the effects regularly.
“When I was in practice, I saw a couple of patients every day who would have benefited from Medicaid expansion,” said Dr. Jessica Schorr Saxe, a recently retired family physician who worked for Carolinas HealthCare System’s Biddle Point clinic in Charlotte.
“Many of them skipped appointments because they didn’t have the money for the copay…or they wouldn’t have the copay for their medications, so they wouldn’t take them regularly,” she said.
Saxe often saw children on Medicaid who were brought in by mothers who worked and were not eligible for Medicaid themselves. “They were my patients too, but they would say, ‘Oh, I can’t see you. I don’t have the money.’ ”
As a result, “you have a population of women of child-bearing age, some of whom didn’t come in and get contraception, and that puts them at risk for having another baby at a short interval.”
Saxe recalled one patient in her 40s who had been discharged from the hospital after having several strokes but had failed to keep followup appointments because she didn’t have insurance or the cash to pay. “She could have died waiting to see me,” Saxe said.
Indeed, an estimated 455 to 1,145 unnecessary deaths a year can be attributed to North Carolina’s failure to expand Medicaid, according to a 2014 study published in the journal Health Affairs. The study also estimated that 14,776 North Carolina residents would face catastrophic medical bills because of the state’s decision.
Consumer advocates who call for Medicaid expansion cite multiple studies showing it not only would improve the health and financial security of citizens, it would provide economic benefits to the state.
For example, expanding Medicaid:
▪ Would create more than 40,000 jobs in the state, according to a 2014 analysis.
▪ Would have enabled the state to collect more than $21 billion in federal funds between 2016 and 2020, according to the same study. Although North Carolina would have to cover about $1.7 billion in additional Medicaid costs, the study says that cost would be offset by gains in state tax revenue.
▪ Would protect the financial health of hospitals, especially those in low-income areas, by saving millions in uncompensated care, according to a 2015 study. In North Carolina, three rural hospitals have closed in recent years, and 16 are listed as “vulnerable.”
Brendan Riley, a Justice Center policy analyst, said supporting hospitals would also support workers and their families. When uninsured workers delay getting health care and chronic conditions worsen, that can lead to frequent workplace absences. If employers don’t provide sick leave, workers risk losing their jobs.
“If you can prevent all that stuff, it’s better for the individual and for the state. … It requires folks to think about the long-term impact,” Riley said.
McCrory and Republican lawmakers oppose Medicaid expansion, in part because they say they don’t trust the federal government to continue paying for most of the extra cost. They also say they won’t consider expanding Medicaid without first reforming – and privatizing – the current Medicaid program to control costs.
It is wrong to provide ‘free’ taxpayer-funded health care benefits to single, able-bodied young men who won’t work when President Obama and the federal government aren’t providing wounded and disabled veterans the health care they were promised at our VA hospitals.
Phil Berger spokeswoman Amy Auth
Today, Medicaid covers 1.9 million North Carolina residents, mostly low-income children and their parents and people who are disabled. The program is administered by the state, but the federal government pays about two-thirds of the $15 billion annual cost.
State legislators say they’ve been frustrated by a string of Medicaid budget overruns from 2010 to 2013. They want to make the budget more predictable by changing the way doctors and hospitals are paid.
The state proposes to stop paying for each doctor’s visit or procedure. Instead, it would contract with private insurers or groups of providers and pay them a flat rate for each patient. The contracting groups would cover any cost overruns, giving them an incentive to provide effective care at the lowest cost.
Senate GOP leader Phil Berger of Rockingham was not available for an interview. His spokeswoman Amy Auth said in an email: “It is wrong to provide ‘free’ taxpayer-funded health care benefits to single, able-bodied young men who won’t work when President Obama and the federal government aren’t providing wounded and disabled veterans the health care they were promised at our VA hospitals.”
About half the 25,000 uninsured veterans in North Carolina will fall into the Medicaid gap in 2017, according to the Robert Wood Johnson Foundation. Many of those veterans “would be eligible if their states expanded Medicaid,” the foundation said.
Studies show that most people who would be covered by Medicaid expansion are working or part of a family where someone is working. They may work in part-time jobs or for employers who don’t offer benefits.
In response to questions from the Observer and News & Observer, McCrory said he has worked “diligently to stabilize our Medicaid program” since 2013, and “after finishing in the red for years, Medicaid is now in the black with a surplus.” And in 2015, he signed the reform bill that will “help to improve patient care and hold down costs.”
Cooper said the state should approach Medicaid reform “cautiously instead of rushing headlong into privatization.” He said North Carolina should build on its success, “instead of abandoning the practices that are providing better care more efficiently.” He said “families are being left without a safety net” because McCrory is “putting his partisan political agenda ahead of North Carolinians.”
Losing federal dollars
Some advocates for Medicaid expansion make the point that North Carolina shouldn’t reject federal tax dollars that are going to other states to expand their Medicaid programs.
“North Carolinians are already paying taxes on the federal level, so why shouldn’t we bring back those dollars to North Carolina to help all of our communities by closing the coverage gap?” said Ciara Zachary, a policy analyst with Justice Center.
But Katherine Restrepo, director of health care policy for the Raleigh-based John Locke Foundation, said it’s misleading to say that taxes from North Carolinians are being sent to other states.
When Congress passed the ACA, she said, no funds were set aside for Medicaid expansion. “It’s just being added onto the federal deficit,” she said. “It’s taxing future generations to provide benefits for our current generation.”
Restrepo called Medicaid expansion a Band Aid instead of a long-term solution.
‘No safety net’
Rhett Brown of Charlotte is one of many family doctors who worry that the state’s plan to privatize Medicaid will make the system more complex for doctors and patients. At a recent public hearing, he argued instead for state officials to expand Medicaid and cover more people.
Brown cited a patient who’s a “perfect example” of someone who could be helped by expansion. For years, the 50-something man has been a self-employed handyman. But in recent years, a spinal condition has limited his ability to work.
Brown has treated the man – for cash at a discount – but he is uninsured and can’t afford to see a neurosurgeon for an evaluation, including an MRI of his cervical spine. The patient is down to working two days a week because he has trouble with balance that makes it dangerous for him to climb ladders, Brown said.
“He is continually getting worse (and) spending himself into poverty,” Brown said. “If this turns out to be a correctable condition, it would have been fixed and (he would have been) back to work and being fully productive, building things, hiring other people to help him, creating jobs.
“If he had been helped early, all of this could have been avoided,” Brown said. “There’s no safety net for this guy.”
News researcher David Raynor contributed to this report.
The Affordable Care Act was designed to increase access to health insurance for most Americans.
When it passed in 2010, the plan was to require all states to expand Medicaid for the poorest adults and to offer subsidized private insurance for low- and moderate-income people through an online marketplace – www.healthcare.gov – offering plans with a standard list of “essential benefits.”
Under the ACA, Medicaid would be expanded to people with incomes of less than 138 percent of the federal poverty level ($16,242 for an individual). The federal government would pay 100 percent of the expansion cost through 2016, dropping to 90 percent by 2020. States would then pick up the remainder.
On the marketplace, families with incomes above 100 percent of the poverty level and up to 400 percent ($47,080 for an individual) would be eligible for tax subsidies to make insurance more affordable. Those below that threshold were expected to enroll in Medicaid.
But in 2012, the Supreme Court ruled that Congress couldn’t force states to expand Medicaid.
When North Carolina chose not to expand, people with incomes below 100 percent of the poverty level were left without access to coverage. They don’t qualify for the current Medicaid program, which covers mostly low-income pregnant women with children and people on disability, and their incomes are too low to qualify for the tax subsidies.