By Derek Lin, MPH
December 7, 2020
In the last blog, we discussed the public health benefits of the Affordable Care Act (ACA) and how it helped New Mexico make gains in health equity through expanded coverage. In this installment we’ll discuss threats to the ACA and steps New Mexico should take now to work towards a healthy future for all New Mexicans.
Since it was implemented in 2010, the ACA has faced strong opposition from Republicans. Although attempts to repeal the ACA have been unsuccessful, the Trump Administration has been highly effective at weakening the ACA by undermining its provisions. This includes making it more difficult to enroll in coverage by adding more administrative hurdles for eligibility and cutting the budget for outreach and enrollment. These reckless attacks on the ACA have had serious consequences for public health, resulting in approximately 726,000 children becoming uninsured nationwide since Trump took office in 2016.
The ACA narrowly survived two Supreme Court hearings in the past and now faces its third hearing in the case California v. Texas. The consequences of a full repeal would be catastrophic and would result in more than 20 million Americans losing access to health care during a pandemic. Now that we are in a recession and millions of people have become unemployed, leading to an unprecedented number of Americans who have lost health insurance, more Americans than ever before will need affordable coverage through the ACA’s marketplace and expanded Medicaid provision. In New Mexico, an ACA repeal would leave upwards of 266,000 New Mexicans without health care, 32,000 without jobs, and the state losing more than $2.3 billion in federal funding. Repealing the ACA will have crippling consequences for both public health and the economy.
While we wait for the outcome of California v. Texas, it is crucial to take action on health care at the state level to prepare for the possibility of a full repeal. Thanks to legislation passed in 2019, steps have already been taken to protect New Mexicans with pre-existing conditions from discrimination by insurance companies, but more work needs to be done to secure access to affordable health coverage. One promising possibility is to implement a Medicaid buy-in plan for New Mexico, which would give New Mexicans the option of purchasing Medicaid coverage using an income-based sliding scale for premiums. Under a targeted Medicaid buy-in plan, the state could provide subsidized coverage for households with income less than 200% of the federal poverty level, a group with one of the highest uninsured rates in the state. This proposal would support many uninsured New Mexicans who struggle to get by but do not qualify for Medicaid, either because of income eligibility limits or immigration status. Given the inadequacy of employer-sponsored health coverage in our state, Medicaid buy-in would also provide the underinsured with an option for accessing affordable, high-quality health plans.
Establishing state subsidies for health care premiums is another equity-minded approach that would help address growing disparities in health and health coverage for immigrants and people of color. As a result of the COVID-19 pandemic, the total number of uninsured New Mexicans in 2020 is projected to have increased by 13% to 214,000, which is up from 187,000 in 2019. In addition to subsidies, state-funded tax credits to offset health insurance premiums for people earning low incomes would further support affordability.
To generate funding for subsidies, New Mexico lawmakers should enact legislation that both reinstates a fee on health insurance companies, bringing in upwards of $125 million, and establishes a Health Care Affordability Fund. Using state funding to make health plans more affordable would help protect community health throughout the pandemic while also priming New Mexico for a more equitable recovery.
Medicaid enrollment could also be improved by eliminating many of its barriers. Even when eligible for Medicaid, many families remain uninsured due to the complicated application process. Automatic enrollment into Medicaid or an exchange-based plan could be done using state income tax filings to identify income-eligible persons. It would eliminate a barrier to enrollment, reduce the need for community outreach, and relieve some of the administrative burden for state agencies. Automatic enrollment could help insure up to 113,000 New Mexicans, or 50% of the current uninsured population in New Mexico.
Making health care affordable is an investment in a healthy workforce and a thriving economy because health insurance helps families access preventive medicine and early intervention. Taking steps now to secure health coverage will help give New Mexico the best chance at bouncing back from the pandemic.
Derek Lin, MPH, is a research and policy analyst with New Mexico Voices for Children