State Options to Increase Health Insurance for the Working Poor
by Jan Kaplan
Background
During the past decade, the number of people without health insurance in the United States has increased by 11 million to 44.3 million. Eight in ten of these uninsured are members of working families. Many of the workers in these families are employed part-time. Typically, they earn low wages and work in service industries, agricultural enterprises, and small businesses that do not offer health insurance to their employees or that require premium cost-sharing at prohibitively high rates. With the growth of these business sectors and continuing health care cost inflation, it is increasingly likely that many newly employed former welfare recipients will not be offered employer-based health coverage or will not be able to afford coverage if it is offered (Kaiser, 1999).
Without health insurance, people with low incomes often do not seek or obtain timely or adequate health care, turning to emergency rooms or other safety net providers, such as community health centers and public hospitals, or forgoing care entirely. Compared with those who are insured, the uninsured tend to have more serious, preventable illnesses that threaten their work productivity and ability to retain jobs.
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) addresses the lack of employer-based health insurance coverage for newly-employed welfare recipients by strengthening the Transitional Medicaid Assistance (TMA) program. PRWORA requires states to provide TMA for up to 12 months to families losing their eligibility for cash assistance under the Temporary Assistance for Needy Families (TANF) program because of increased earnings. Although states may extend the duration of the TMA benefit beyond 12 months, the program does not address the long-term health insurance needs of low-wage workers.
As private health insurance coverage declined between 1987 and 1994, Medicaid expansions increased the number of pregnant women and children with public health insurance coverage. After 1994, the proportion of the population on Medicaid decreased. States are now using funds provided under the new State Children’s Health Insurance Program (SCHIP) to develop health coverage programs for children who are not eligible for Medicaid or private coverage. However, Medicaid eligibility for low-wage working parents is very limited. Few states provide Medicaid coverage to single parents with incomes above 100 percent of the federal poverty level. Half of the states only cover working parents with incomes below 59 percent of poverty and, in nine states, working parents are ineligible for Medicaid if their incomes are above 37 percent of poverty (Guyer and Mann, 1999). Even fewer states offer Medicaid to parents in two-parent families or to single adults, leaving 50 percent of poor adults in two-parent families and 46 percent of single adults without children uninsured (Kaiser, 1999).
As states continue to move welfare recipients successfully into employment, they are increasingly exploring approaches to expand the availability of both public and private health insurance for low-income working adults. This Issue Note seeks to help state policymakers evaluate health insurance options at the state level as well as opportunities emerging at the federal level.
Policy Issues
States may want to consider the following issues before they move ahead to increase health insurance coverage for low-income workers.
How can states use Transitional Medicaid Assistance to extend health care coverage to former TANF recipients? TMA was designed to fill the gap, for the short term, in employer-based coverage and to eliminate the lack of health insurance as a disincentive to work. States need to ensure that social services agency staff is trained to track the eligibility status of TANF recipients and to educate them about TMA. In addition, aggressive outreach efforts are necessary to reach all eligible clients. States may extend the duration of the benefit or modify eligibility criteria and income reporting requirements to cover more beneficiaries for a longer time (Kaplan, 1997; and Health Care Financing Administration, 1999).
How can states broaden Medicaid eligibility to cover more low-income workers? PRWORA eliminated the link between Medicaid and cash assistance, so TANF recipients are not automatically eligible for Medicaid. However, the law requires states to continue to cover families with children that meet the income, resource, and family composition rules in effect for the Aid to Families with Dependent Children (AFDC) program as of July 16, 1996. This requirement, known as Section 1931 or the "family coverage category," means that very poor families remain eligible for Medicaid. Section 1931 also allows states to broaden their eligibility standards in the following ways to extend coverage to low-income working parents (Schlosberg and Ferber, 1998; Health Care Financing Administration, 1999; and Guyer and Mann, 1998).
Use Section 1931 to extend coverage for families. Section 1931 gives states the flexibility to "disregard" (i.e., not count) income and resources and to develop less-restrictive methodologies in determining Medicaid eligibility for families. States can raise their income and resource limits to a level they deem appropriate and "as far as state budget and policy preferences permit." They also may choose to disregard certain resources, such as the value of a car, or earnings up to a certain level, so a family’s "countable" earnings stay below the levels in effect as of July 16, 1996. The federal government will match between 50 percent and 79 percent of state expenditures for the expanded Medicaid coverage, depending on the state’s Medicaid matching rate. Under Section 1931, states have covered parents with incomes as high as 200 percent of poverty. States may find Section 1931 expansions particularly attractive because they are not required to seek a federal waiver of the federal Medicaid law to implement the changes; they must only include their proposed changes in their Medicaid state plan.
Use Section 1931 to expand coverage for families for a specified period. States may want to phase in Section 1931 expansions of income and resource limits and methodologies. This approach could work for a state that is concerned about additional state expenditures to draw down federal matching payments for expanded coverage or for one interested in Medicaid expansions as an interim approach to comprehensive health care coverage for low-income working families. A state might use Section 1931 to extend the duration of its TMA benefit. Other states might want to increase their resource and income limits and/or modify their income disregards for a specified period. For example, a state could provide Medicaid coverage to families with earnings above the federal poverty level for up to two years.
Use Section 1931 to eliminate the asset test for families. States can use Section 1931 to eliminate the "asset test" when determining Medicaid eligibility. Under this approach, a family’s total assets may be disregarded. Many states already disregard assets when determining a child’s eligibility for Medicaid.
Use Section 1931 to cover two-parent families. Recent federal regulations allow states to eliminate the limit on the number of hours that the primary wage earner in a two-parent family can work while retaining Medicaid eligibility. Prior to the 1998 rule (45 CFR 233), states could not provide Medicaid to families in which the primary wage earner in a two-parent family worked more than 100 hours per month. The elimination of the "100-hour rule" allows states to expand Medicaid coverage to adults in two-parent families with earnings up to a state’s established income standard.
What other options do states have to increase public health insurance coverage for the working poor? States might consider the following options to expand coverage for the working poor.
Waivers of the federal Medicaid law. Waivers have enabled some states to change their eligibility standards in order to expand coverage to individuals not otherwise eligible for Medicaid and to receive federal Medicaid matching funds for those expansions. Nearly 24 states now have approved or pending Section 1115 waivers with the federal Health Care Financing Administration (HCFA). Section 1115 waivers allow for pilot or demonstration projects to test new policy approaches to providing services that would otherwise not be eligible for federal matching payments. These waivers allow states to enact comprehensive health reforms, such as extending the duration of TMA coverage and/or modifying TMA eligibility standards; expanding Medicaid eligibility by disregarding more resources than is allowed under the federal standard; using higher income standards and more liberal methodologies for determining eligibility; and expanding coverage to additional categories of individuals, but limiting or altering the scope of benefits. Waivers have a time limit of five years, but states must request continuations annually. The application and approval process for waivers can be lengthy and complex. In addition, the waived program must be "budget neutral" (i.e., any increase in federal spending on new coverage must be offset by federal savings resulting from other changes in the state’s Medicaid program). Despite these requirements, states may want to consider waivers if they are interested in additional program expansions beyond those allowed under Section 1931. For more information, visit http://www.hcfa.gov/medicaid/hpg5.htm and http://medicaid.aphsa.org/waivers/1115waivers.htm.
State-only funds. States also can use their own funds to expand coverage for the working poor. State expansions could be supported by general revenues; special or targeted taxes, such as cigarette or health care provider taxes; or local tax revenues. Some states are using funds received from the recent tobacco settlement to support health insurance reforms. State funds can be combined with federal Medicaid funds; other federal funds, such as the Maternal and Child Health Block Grant (Title V); and private monies, such as foundation grants, to create broader programs of health insurance coverage than are allowed under Medicaid. State-funded programs are not subject to federal regulation and oversight and can afford states greater flexibility to design their own benefits package, eligibility standards, and cost-sharing requirements. However, these programs can be extremely costly to maintain. (Also see Holahan, Wiener, and Wallin 1998.)
General Assistance. Medical assistance provided under state and county General Assistance (GA) programs can provide health insurance coverage to populations that may not be eligible for other public insurance programs. These populations include able-bodied adults without children as well as disabled, elderly, or otherwise unemployable adults who are not eligible or who are awaiting approval for Supplemental Security Income. Typically, the medical assistance coverage provided under state GA programs is more limited in scope than the Medicaid benefits package, covering acute care but not preventive or routine care. In addition, the duration of GA medical assistance is tied to the duration of GA, which in most states is limited. (Also see Gallagher et al., 1999.)
Can states cover low-income working parents under the new State Children’s Health Insurance Program? SCHIP was established under Title XXI of the Social Security Act to provide insurance coverage for low-income children who are not eligible for Medicaid. The law gives states the option to establish "family coverage" for the adult members of the family. States may want to consider this option for several reasons. First, Title XXI provides states with federal funds at an enhanced Medicaid matching rate that is above a state’s regular rate. Second, parents’ enrollment in SCHIP increases the likelihood that their children will be enrolled. Finally, family coverage under SCHIP would result in a seamless system of insurance and care for the entire family.
States interested in including family coverage in their SCHIP plan must obtain a "variance" from HCFA. HCFA will approve a state variance if the state can demonstrate that the family coverage will be "cost- effective" (i.e., the cost of providing coverage for the family will not exceed the cost of providing coverage solely for the child); the new family coverage will not substitute for other health insurance coverage; the family includes "targeted low-income children" who are eligible for SCHIP; and the coverage provides an established minimum level of benefits and includes limits on beneficiary cost-sharing. To date, HCFA has not issued formal guidance to states clarifying its variance authority for family coverage. Absent clear guidance, few states have sought approval for full family coverage.
However, other approaches to family coverage do not require a variance. States can take advantage of the enhanced federal matching rate under Title XXI by coordinating SCHIP coverage for children with Medicaid expansions for low-income parents achieved through Section 1115 waivers or Section 1931. States also can use Medicaid funds or their own funds to subsidize the cost of private insurance for low-income workers. The adult coverage achieved through the subsidies could be coordinated with the state’s program for children under Title XXI in order to cover entire families and receive the enhanced match for the SCHIP portion of coverage. (Also see National Governors’ Association, 1999; and Gehshan and McDonough, 1998.)
How can states use Medicaid dollars or their own funds to increase employer-provided health insurance for low-income workers? States can use Medicaid dollars or their own funds to subsidize the cost of private health insurance. Federal Medicaid law allows states to purchase employer-provided insurance for Medicaid recipients if it is cost-effective to do so. Some states do not use this option because they find the administrative requirements of these private insurance "buy-in" programs to be burdensome and not cost-effective. However, buy-in programs may allow states to preserve limited public funds when employer-based coverage is offered to Medicaid-eligible workers. Using Section 1931 flexibility, states can provide subsidies through Medicaid to low-income workers for the purchase of private coverage they could otherwise not afford. The state expenditures would be federally matched.
States concerned about the federal requirements for Medicaid buy-in programs could use state funds to subsidize the cost of private insurance for low-income workers. Subsidies can be coordinated with SCHIP coverage, including SCHIP buy-in programs, so children and their parents fall under a single insurance and care package. (Also see Tollen, 1999.)
How can the private insurance market meet the needs of low-income workers? There are several national and state-level policy options to improve the working poor’s access to employer-based health insurance. For more information, see Feder, Ucello, and O’Brien, 1999; and Blumberg and Nichols, 1998.
Tax deductions or tax credits for health insurance. Some interest groups and policymakers recommend that the income tax system be used to subsidize the cost of private health insurance and expand coverage. States could incorporate some elements of these tax proposals into their tax systems. The proposals aim to make private insurance more affordable by allowing for the deduction of the cost of health insurance expenses from an individual’s income taxes or by giving individuals a flat amount (or credit) toward the purchase of insurance. Income tax deductions would only benefit individuals who owe taxes and would increase with increases in income. In contrast, tax credits would lower the amount of taxes owed or would be paid to individuals regardless of whether they owed taxes. Credits would be more beneficial than tax deductions to lower-wage workers who may not earn enough to pay taxes. Although most tax subsidy programs benefit those who are already insured, they may be attractive to the uninsured because they allow them to purchase mainstream health insurance coverage without the stigma associated with public insurance programs. (Also see Kaiser Family Foundation, 2000; and Glied, 1999.)
Medical Savings Accounts. The federal Health Insurance Portability and Accountability Act of 1996 authorized a national demonstration of tax-advantaged personal savings accounts called medical savings accounts (MSAs). MSAs seek to increase access to private health insurance with low premiums but high out-of-pocket costs by allowing individuals to pay current out-of-pocket medical costs with pretax dollars and accumulate funds on a tax-free basis for future medical expenses. Funds deposited in an MSA and subsequently used to pay medical expenses, including deductibles, are not counted toward gross income for tax purposes. MSAs give individuals, rather than third-party payers, control over how funds are expended to pay for their care.
Private insurance market reforms. Given the increasing number of low-income workers employed by small firms that do not offer health insurance or that offer coverage with unaffordable premiums, states may be interested in reforming the private insurance market for small employers. Congress enacted the Health Insurance Portability and Accountability Act of 1996 (HIPAA) to protect health insurance coverage for individuals who change jobs, lose a job, become self-employed, or are employed by a company that does not offer health benefits. HIPAA’s protections come from many of the same regulatory mechanisms that states have used to increase access to insurance for high-risk populations and ensure continuity of coverage. HIPAA and more stringent state health insurance regulations afford protections such as guaranteed renewal—insurers cannot refuse to sell a policy to existing customers when their health status or experience has changed (worsened); limits on preexisting condition exclusions—insurers are limited in the amount of time they may deny coverage for a prior health condition; portability—workers who change jobs are not subject to new waiting periods for preexisting conditions; and guaranteed issue—insurers that offer a health insurance product must offer it to all people and firms wanting the product but may charge a different price. (Also see Tapay and Feder, 1999; and Johnson-Wilson, 1996.)
Other reforms at the state level aim to make premiums more affordable by regulating rates, reducing administrative costs, or spreading the health risks of employees. States use rate restrictions to control premium costs. Although these restrictions make insurance more affordable for individuals with high health care costs, they may result in increased premiums for those with lower risks and lead them to drop coverage. Community rating pools, the most common approach, base premium price differences on geographic location, family size, and scope of benefits, rather than on the health experiences of members of the insured group. Some states allow groups of small employers and/or individuals to form purchasing pools in order to spread risk among a larger population. The pools improve leverage in premium negotiations, increase administrative simplicity, and create a single point of entry to multiple insurers and benefit packages. To date, the purchasing pools and other private insurance market reforms have had varying degrees of success, depending on the state’s regulatory, business, and health care environments. (Also see Blumberg and Nichols, 1998.)
Research Findings
During the past decade, several studies have looked at the relationship between public and/or private health insurance availability and labor market decisions among welfare beneficiaries. A literature review by Wooldridge and Hoag (1996) on the insurance/welfare-to-work relationship concludes that family health status and coverage affect the successful transition to work. In particular, the review indicates that adequate insurance coverage for dependent children influenced single women’s decision to leave AFDC and enter the workforce. Another study of the relationship between the Medicaid expansions of the late 1980s and early 1990s and a woman’s decision to leave AFDC found that increased Medicaid income eligibility for children had a significant effect on the probability that a woman would decide to enter the workforce. It can be inferred that Medicaid eligibility expansions for low-income adults would have similar effects on welfare and labor force participation among adult women (Yelowitz, 1996).
A study by Moffitt (1997) looked at the effect of the availability of private health insurance on women’s successful transition from welfare to work. The study found a strong relationship between coverage and successful employment among women with health problems. However, it found that the welfare decisions of women and children with minimal medical care needs were not significantly affected by the availability of private insurance. A related study found that increases in the value of available private insurance could lead to a reduction in AFDC caseloads by as much as 16 percent and raise employment rates among female heads of households by up to 12 percent (Moffitt, 1997). Preliminary data from a study by Mathematica Policy Research, Inc., indicates a relationship between increased utilization of Transitional Medicaid Assistance and job retention for a period of up to four years after the receipt of welfare. (Also see Kaplan, 1997.)
Other research seeks to predict the extent of coverage and related implementation costs of different approaches to providing health insurance coverage to low-income workers. Typically, researchers look at factors such as outreach and education, enrollment simplification, and administrative costs in making their projections.
Although there are no studies to date of state Medicaid expansions under Section 1931, researchers have made projections of the coverage and costs of Medicaid expansions, in general. (Also see Kaplan, 1997.) Feder et al. (1999) projected that Medicaid expansions aimed at parents of children already covered by Medicaid or SCHIP would reach all eligible adults, but only 7 percent of all uninsured adults. If a premium payment is required, they estimated that only 39 percent of families above the federal poverty level would participate. However, they found that expansions without a premium payment requirement aimed at all adults with income below the poverty level would achieve a 79 percent participation rate and would cover 22 percent of the uninsured poor. Other barriers to enrollment would prevent full participation. The cost per newly insured adult is estimated to range from $3,306 to $3,582.
Research on coverage and the implementation costs of individual state experiments under Medicaid Section 1115 waivers and through the use of state-only funds is ongoing. This body of research is extremely diverse in methodology and focus, reflecting the different structure and goals of state health insurance expansion efforts.
Gallagher et al. (1998) have studied state health coverage for low-income workers without children through General Assistance (GA) programs. Their survey found that of the 35 states with GA programs, only 13 provide assistance to able-bodied adults. The other states offer assistance to the severely poor, to individuals with disabilities or other health problems, and to the elderly. Twenty-six of the states that provide GA also provide medical assistance to recipients. County-run programs are less likely to provide medical benefits to their GA population. In five of the state GA programs, medical assistance is provided through Medicaid or Section 1115 waiver programs.
Feder et al. (1999) have estimated that 22 percent of uninsured adults would benefit from direct subsidies for the purchase of private insurance. A subsidy program would cost between $3,300 and $3,500 per newly insured. Participation would depend on the availability and appropriateness of coverage policies, the size of the subsidies, the application process, and outreach efforts. Participation would be greatest when subsidies are high (more than 60 percent of insurance costs), the enrollment process is simplified, and the health care package is deemed to be of high quality. (Also see Glied, 1999.)
The analysis by Feder et al. and a large body of other research also have looked at the issue of "crowd-out," defined as the substitution of public insurance expansions, including subsidies for the purchase of private insurance, for previously private expenditures for coverage. Most recently, crowd-out has been a concern in SCHIP implementation. Researchers have found that the likelihood of a subsidy program substituting for private coverage is greater when there is a higher income cutoff for participation. In evaluating options for coverage expansions for low-income workers, as well as for children through SCHIP, researchers are considering methods to prevent workers from choosing a subsidy program rather than employer-based coverage; to encourage employees to retain employer-provided coverage; and to avoid creating disincentives for employers to provide insurance (Glied, 1999; and Demkovich, 1998). (Also, see The Lewin Group, 1997.)
Tax subsidies (deductions and/or credits) for the purchase of private health insurance are somewhat effective in expanding private insurance coverage for the uninsured, according to some analyses. Using a detailed microsimulation model of federal tax subsidy proposals, Gruber and Levitt (2000) found that although tax subsidies have the potential to significantly increase insurance coverage, covering large numbers of uninsured would cost approximately $13 billion annually and would not cover more than about 4 million people. Feder et al. (1999) made similar projections and found that tax subsidies based on income, rather than on employment (and coverage) status, would primarily benefit individuals who already have insurance.
A 1997/1998 survey of the insurance industry’s involvement with MSAs indicates that MSA-qualifying plans are widely available in all but four states, but that few new plans will enter the market without a growth in demand. Although insurers did not report targeting their products to uninsured individuals, about one-third of the MSAs opened in 1997 were opened by previously uninsured individuals. Insurers also reported that they expect relatively better health status and lower service utilization among enrollees (U.S. General Accounting Office, 1999). An earlier analysis by the American Academy of Actuaries (1995) found that widespread purchase of MSAs by healthier individuals could lead to a doubling in premiums for individuals who purchase conventional insurance and a drop in coverage.
A study of the causes for variations in state- and local-level health insurance coverage rates indicates that small-group market reforms are strongly associated with higher rates of private and overall coverage, while premium rate restrictions result in lower rates of private insurance and overall coverage. The study concludes that states instituting small-group market reforms along with premium rate restrictions experience no net effect on insurance coverage (Marsteller et al., 1998). Case studies of private insurance market reforms enacted in New York, Kentucky, New Hampshire, New Jersey, and Maryland found that the likelihood of specific reforms improving the spread of risk and the ability of small employers and individuals to access health insurance was "heavily influenced" by the reforms’ content and structure. The study’s authors caution that state reforms often are complex, with interacting components that must be individually identified and analyzed prior to drawing conclusions on the effect of the overall reform effort (Tapay and Feder, 1999).
A recent analysis by the U.S. General Accounting Office (2000) of the advantages of health insurance purchasing cooperatives found that they offer administrative simplicity and benefit choices to participating employers. However, the analysis found no improvement in leverage in negotiating lower premiums, a key factor in small employers’ decision to purchase coverage.
Innovative Programs
A number of states have implemented programs to expand public and/or private health insurance coverage to the working poor. These innovations vary widely in their structure, eligibility criteria, funding sources, and benefits. For additional profiles of state initiatives, see Krebs-Carter, 2000.
In 1994, Maryland instituted small-group market reforms to increase access to private insurance for the self-employed and businesses with 50 or fewer employees. The reforms included guaranteed issuance, renewability, limitations on the use of preexisting condition exclusions, standardized benefits, and modified experience rating. Between 1995 and 1998, there was a 24 percent increase in the number of small employers providing health insurance and a 20 percent increase in the number of employees covered. Contact: Gerard Petrik, Maryland Health Care Access and Cost Commission, 410/764-3449 or gpetrik@mhcc.state.md.us.
In Massachusetts, the MassHealth Family Assistance Program covers families with incomes up to 200 percent of the federal poverty level through a combination of programs funded through Medicaid, SCHIP, private funds, and state funds. Through the Family Assistance Program, one of the first SCHIP family coverage plans approved by HCFA, premium assistance is provided for families with children who are eligible for SCHIP. MassHealth, the state’s Medicaid program approved through a Section 1115 waiver, provides full subsidies to families with incomes below 150 percent of the federal poverty level for the cost of their health insurance premium. MassHealth Medicaid benefits are provided to families with incomes below 150 percent of poverty without employer-provided insurance. Families with incomes between 150 percent and 200 percent of poverty receiving subsidies for employer-provided insurance through the Family Assistance Program must pay a portion of the monthly premium. Incentive payments are made to small employers that provide insurance benefits to their low-income employees. Contact: Pat Canney, Massachusetts Division of Medical Assistance, 617/210-5672 or http://www.state.ma.us/dma/masshealthinfo/applmemb_IDX.htm.
Minnesota has expanded its Medicaid program through a Section 1115 waiver and its Section 1931 authority. The state has eliminated the 100-hour rule to ease Medicaid eligibility rules for two-income families and raised its income standard for parents by 3 percent. The state’s publicly subsidized health insurance program, MinnesotaCare, covers uninsured families with children with incomes up to 275 percent of the federal poverty level and uninsured adults with incomes up to 175 percent of poverty. MinnesotaCare enrollees cannot have access to 50-percent employer-subsidized coverage. The program is funded through enrollee premiums, taxes on health care providers, and federal matching funds for covered children, pregnant women, and parents with incomes below 175 percent of poverty. The state is expanding MinnesotaCare administration to include county enrollment sites to eliminate gaps in coverage as families move between the state’s health care programs. Those who are leaving MinnesotaCare because of higher income receive information about other insurance options during an 18-month "disenrollment period." Contact: Julie Skoy, Minnesota Health Care Access Unit, 651/297-4344 or Julie.Skoy@state.mn.us.
Oregon’s Family Health Insurance Assistance Program (FHIAP) is a state-funded program that provides direct subsidies to families with incomes below 200 percent of the federal poverty level to help them buy health insurance through their employer or the individual market. The subsidy amount is determined by family income, the number of people to be insured, and family size. To ensure coverage of all children in an eligible family, adults may not receive assistance through FHIAP unless all children in the family are covered under a health benefit plan or Medicaid. The program is funded solely through appropriations from the state general assembly. Contact: Kelly Harms, Oregon FHIAP, 503/373-1692 or kelly.harms@state.or.us; or http://www.ipgb.state.or.us./fhiapgen.htm.
In Washington, expanded coverage for low-income workers includes Section 1931 expansions with income and asset exclusions and the Basic Health Plan (BHP), a state-funded health coverage program. The BHP provides low-cost subsidized health insurance for any state resident with an income below 200 percent of the federal poverty level; sliding-scale premiums are based on income, age, and family size. TheBHP is integrated with the state’s Medicaid expansions, and eligibility is determined collaboratively between the two programs. Contact: Jill Hanks, Washington Department of Social and Health Services, 360/923-2645 or http://www.wa.gov/hca/Basic.htm.
West Virginia will reimburse former TANF recipients and/or their spouses up to $125 per month for the purchase of private health insurance. Former TANF recipients with incomes up to 185 percent of the federal poverty level, as well as a child and working adult in the home, are eligible for the reimbursement. If the reimbursement does not meet the entire cost of the insurance, the client must agree to pay the difference. The payment does not cover the employee’s children, except when required by the employer as a condition for coverage for the worker. If their children have no other insurance, clients are encouraged to apply for Medicaid and/or SCHIP. Contact: Sue Buster, West Virginia Department of Health and Human Resources, 304/558-3796.
Wisconsin’s BadgerCare ensures access to health care for uninsured children and parents with incomes at or below 185 percent of the federal poverty level. Once enrolled, families may remain in BadgerCare until family income exceeds 200 percent of poverty. Under a Section 1115 waiver, BadgerCare expands Medicaid coverage for adults. Title XXI (SCHIP) funds are used to finance child coverage. The Section 1115 waiver allows the program to impose a monthly premium for families with incomes above 150 percent of poverty. When employer coverage is available, BadgerCare purchases the coverage for families, with the employer paying between 60 percent and 80 percent of the premium. Badgercare’s Health Insurance Payment Program uses Title XXI funds to pay a portion of the premiums for parents with incomes below 150 percent of poverty and with access to employer-sponsored insurance. Contact: Angie Dombrowicki, Wisconsin Department of Health and Family Services, 608/266-1935 or dombra@dhfs.state.wi.us; or http://www.dhfs.state.wi.us.
The Robert Wood Johnson Foundation’s State Initiatives in Health Care Reform provides financial and technical assistance to states to support the development and implementation of policies aimed at increasing access to health services and controlling health care costs. The program supports direct expansions of coverage, mechanisms to finance uncompensated care, insurance market reforms, enhanced state health care purchasing strategies, and the monitoring and regulating of health plans and other risk-bearing entities. Contact Anne Gauthier, Academy for Health Services Research and Health Policy, 202/296-6700 or SI@ahsrhp.org; or http://www.ahsrhp.org/httpdocs/si.html.
The federal Health Resources and Services Administration (HRSA) recently announced the availability of $15 million in state planning grants. The grants support one-year studies by states to identify uninsured residents and design proposals for providing them access to quality, affordable health insurance. Up to ten states will receive grant funds. Contact Marcia Brand, HRSA, 301/443-4619 or mbrand@hrsa.gov; or http://www.hrsa.gov/Newsroom/releases/2000%20Releases/stateplanning.htm.
Resource Contacts
Academy for Health Services Research and Health Policy, Anne Gauthier, 202/296-6700 or gauthier@ahsrp.org.
Center on Budget and Policy Priorities, Jocelyn Guyer, 202/408-1080 or guyer@center.cbpp.org.
Kaiser Commission on Medicaid and the Uninsured, Dawn Nelson, 202/347-5270 or kcmu@kff.org.
National Conference of State Legislatures, Shelly Gehshan and Joy Johnson-Wilson, 202/624-5400 or shelly.gehshan@ncsl.org or joy.wilson@ncsl.org.
National Governors’ Association, Joan Henneberry and Emily Cornell, 202/624-5300 or jhenneberry@nga.org or ecornell@nga.org.
The Heritage Foundation, Stuart Butler, 202/546-4400 or staff@heritage.org.
Publications
American Academy of Actuaries. Medical Savings Accounts: Cost Implications and Design Issues., Washington , D.C., May 1995. Available at http://www.geocities.com/WallStreet/1647/monohome.html
Blumberg, Linda J., and Len M. Nichols. Health Insurance Market Reforms: What They Can and Cannot Do. Washington, D.C.: The Urban Institute, 1998. Available at http://www.urban.org/pubs/hinsure/insure.htm.
Butler, Stuart M. Principles to Guide Reform of Health Care for Working Families. Washington, D.C.: The Heritage Foundation, January 20, 1999. Available at http://www.heritage.org/Research/HealthCare/BG1243.cfm.
Demkovich, Linda. "SCHIP, Part II: Crowd Out, Family Coverage Command States’ Attention." State Health Notes, vol. 19, no. 274 (April 13, 1998). National Conference of State Legislatures, Denver, Colo. Available at http://stateserv.hpts.org/public/pubhome.nsf.
Feder, Judith, Cori Uccello, and Ellen O’Brien. The Difference Different Approaches Make: Comparing Proposals to Expand Health Insurance. Washington, D.C.: Kaiser Family Foundation, October 1999. Available at http://www.kff.org/content/1999/1532/.
Findlay, Steven, and Joel Miller. Down a Dangerous Path: The Erosion of Health Insurance Coverage in the United States. Washington, D.C.: National Coalition on Health Care, May 1999. Available at http://www.nchc.org/releases/erosion.html.
Gallagher, L. Jerome, et al. State General Assistance Programs 1998. Washington, D.C.: The Urban Institute. Available at http://newfederalism.urban.org/html/ga_programs/ga_full.html#benmax.
Garrett, Bowen, and John Holahan. Welfare Leavers, Medicaid Coverage, and Private Health Insurance. Washington, D.C.: The Urban Institute, March 2000. Available at http://newfederalism.urban.org/html/series_b/b13/b13.html.
Gehshan, Shelly, and John McDonough. Family Coverage Under the Children’s Health Insurance. Denver, Colo.: National Conference of State Legislatures, November 1998. Available at http://stateserv.hpts.org/public/pubhome.nsf.
Glied, Sherry. An Assessment of Strategies for Expanding Health Insurance Coverage. Washington, D.C.: Kaiser Family Foundation, October 1999. Available at http://www.kff.org/content/1999/1533/.
Gruber, Jonathan, and Larry Levitt. "Tax Subsidies for Health Insurance: Costs and Benefits." Health Affairs. Bethesda, Md.: Project HOPE, Center for Health Affairs, January/February 2000. Available at http://www.projhope.org/HA/bonus/190105.htm.
Guyer, Jocelyn, and Cindy Mann. Employed but Not Insured: A State-by-State Analysis of the Number of Low-Income Working Parents Who Lack Health Insurance. Washington, D.C.: Center on Budget and Policy Priorities, February 9, 1999. Available at http://www.cbpp.org/2-9-99mcaid.htm.
Guyer, Jocelyn, and Cindy Mann. Taking the Next Step: States Can Now Take Advantage of Federal Medicaid Matching Funds to Expand Health Care Coverage to Low-Income Working Parents. Washington, D.C.: Center on Budget and Policy Priorities, August 20, 1998. Available at http://www.cbpp.org/8-20-98mcaid.pdf.
Health Care Financing Administration. Supporting Families in Transition: A Guide to Expanding Health Coverage in the Post-Welfare Reform World, Washington, D.C., March 26, 1999. Available at http://www.hcfa.gov/medicaid/welfare.htm.
Holahan, John, Joshua Wiener, and Susan Wallin. Health Policy for the Low-Income Population: Major Findings from the Assessing the New Federalism Case Studies. Washington, D.C.: The Urban Institute, November 1998. Available at http://www.urban.org.
Johnson, Amy, and Alicia Meckstroth. Ancillary Services to Support Welfare to Work: Lack of Health Insurance. Princeton, N.J.: Mathematica Policy Research, Inc., June 22, 1998. Available at http://aspe.hhs.gov/hsp/isp/ancillary/hi.htm.
Johnson-Wilson, Joy. NCSL Health Committee Bill Summary: The Health Insurance Portability and Accountability Act of 1996. Denver, Colo.: National Conference of State Legislatures, August 13, 1996. Available at http://www.ncsl.org/statefed/HR3103.HTM.
Kaiser Commission on Medicaid and the Uninsured. A Profile of the Low-Income Uninsured. Washington, D.C.: Kaiser Family Foundation, August 1999. Available at http://www.kff.org.
Kaiser Family Foundation. Fact Sheet—Assessing Tax Subsidies to Cover the Uninsured. Washington, D.C.: Kaiser Family Foundation, January 2000. Available at http://www.kff.org.
Kaplan, Jan. Transitional Medicaid Assistance. Washington, D.C.: Welfare Information Network, December 1997. Available at http://www.welfareinfo.org/tmedicaid.htm.
Krebs-Carter, Melora, and John Holahan. State Strategies for Covering Uninsured Adults. Washington, D.C.: The Urban Institute, May 2000. Available at http://newfederalism.urban.org/html/discussion00-02.html
Marsteller, Jill A., Len M. Nichols et al. Variations in the Uninsured: State and Local Level Analyses. Washington, D.C.: The Urban Institute, June 1998. Available at http://www.urban.org/health/variatFR.html.
Moffitt, Robert A., and Eric Slade. "Health Care Coverage for Children On and Off Welfare." The Future of Children: Welfare to Work, vol. 7, no.1 (spring 1997). Available at http://www.futureofchildren.org/wtw/index.htm
National Governors’ Association. "State Tools to Provide Family Health Insurance Coverage." Issue Brief (January 4, 1999). Washington, D.C.: National Governors’ Association. Available at http://www.nga.org/Pubs/IssueBriefs/1999/Sum990104SCHIP.asp.
Schlosberg, Claudia, and Joel D. Ferber. Access to Medicaid Since the Personal Responsibility and Work Opportunity Reconciliation Act. Los Angeles, Calif.: National Health Law Project, January 1998. Available at http://nhelp.org/pubs/med1998accessmedicaid.html.
Tapay, Nicole, and Judith Feder. Insurance Market Reforms and the Individual Insurance Marketplace: Implications for Coverage Expansions. Washington, D.C.: Kaiser Family Foundation, October 1999. Available at http://www.kff.org/content/1999/19991112o/.
The Lewin Group. Examining Substitution: State Strategies to Limit "Crowd Out" in the Era of Children’s Health Insurance Expansions. Falls Church, Va.: The Lewin Group, December 9, 1997. Available at http://aspe.os.dhhs.gov/health/reports/hinsubst/front.htm.
Tollen, Laura A. Purchasing Private Health Insurance Through Government Health Care Programs: A Guide for States. Washington, D.C.:Institute for Health Policy Solutions, June 1999. Available at http://www.ihps.org
U.S. General Accounting Office. Medical Savings Accounts: Results from Surveys of Insurers. HEHS-99-34. Washington, D.C., December 31, 1998. Available at http://www.gao.gov.
U.S. General Accounting Office. Private Health Insurance: Cooperatives Offer Small Employers Plan Choice and Market Prices. HEHS-00-49. Washington, D.C., March 2000. Available at http://www.gao.gov.
Wooldridge, Judith, and Sheila Hoag. Medicaid’s Role in Encouraging Transitions from Welfare to Work. Princeton, N.J.: Mathematica Policy Research, Inc., October 4, 1996. Contact 609/799-3535 or visit http://www.mathematica-mpr.com/HEALTH.HTM.
Yelowitz, Aaron, S. The Medicaid Notch, Labor Supply, and Welfare Participation: Evidence from Eligibility Expansion. Discussion Paper 1084-96. Madison, Wis.: Institute for Research on Poverty, April 1996. Contact 608/262-6358 or visit http://www.ssc.wisc.edu/irp/dplist.htm.
The Welfare Information Network is supported by grants from the Annie E. Casey Foundation, the Charles Stewart Mott Foundation, the David and Lucile Packard Foundation, the Edna McConnell Clark Foundation, the Ford Foundation, the Woods Fund of Chicago, the Administration for Children and Families, U.S. Department of Health and Human Services, and the U.S. Department of Labor
The Making Wages Work website and accompanying list serve are dedicated to encouraging the discussion and promotion of policies and programs such as the Earned Income Tax Credit, work incentives, the minimum wage, food stamps, unemployment insurance, and child support that supplement income and wages in order to help families escape poverty and avoid welfare dependency. Visit the website and join the discussion list at www.makingwageswork.org
