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Black Communities Caught in the Health “Coverage Gap”

Written by Sureshi Jayawardene

February 2, 2015

The 2010 Affordable Care Act (ACA) provided for the expansion of Medicaid eligibility to almost all low-income individuals with incomes at or below 138% of poverty (i.e. $11,670 for an individual and $27, 310 for a family of three). Due to this major coverage provision, the percentage of people of color without health insurance is projected to radically decrease by 2016. Premium tax credits for Marketplace coverage serve as the means for covering individuals with moderate incomes. Although the Medicaid expansion was expected to be a national effort, a Supreme Court ruling in June 2012 made it optional for states.

As of October 2014, 23 states are not expanding their Medicaid programs. As a result Medicaid eligibility for adults in these states remains limited:

Median income limit for

parents in 2014 is just 50% of

poverty (or, annual income of

$9,893/year for a family of

three);

Childless adults will remain

ineligible;

Financial assistance to people

below poverty for other

coverage options will not be

provided, since ACA was

envisioned as providing

coverage to low income

people through Medicaid.

Who is caught in the ‘Coverage Gap?’ As a result of this nonexpansion, a number of adults will fall into what researchers are calling a “coverage gap” for having incomes higher than Medicaid eligibility limits but well below the lower limit for Marketplace premium tax credits.

According to the Kaiser Family Foundation, nearly 4 million poor uninsured adults fall within this “coverage gap” directly resulting from state decisions not to expand Medicaid. Had their state chosen to expand Medicaid eligibility, these individuals would have been newly-eligible. The majority of people who fall in the ‘coverage gap’ are employed. These are the working poor, who are paying the bills with part-time employment or working for an employer who does not offer insurance. Some may be working at multiple jobs to make ends meet, while others may be full time students. More than a quarter (1.4 million) of the 4 million people in the coverage gap are African Americans. While a significant number of Latin@s are also caught in the coverage gap, these numbers are not as disproportionate because of the large populations of Latin@s who live in states that have expanded Medicaid. These states include California, New York, and Arizona.

According to the Urban

CURRENT ISSUES Photo Source: The Pew Charitable Trusts

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live in states that have expanded Medicaid. These states include California, New York, and Arizona.

According to the Urban Institute, 55% of all African Americans live in the 23 states that have not expanded Medicaid eligibility under the ACA. This is in comparison with 42% of Whites, 38% of Latin@s, and 23% of Asians who live in nonexpansion states. Even with existing Medicaid program in the nonexpansion states, a disproportionate number of Blacks do not qualify. Typically, Medicaid covers pregnant women, young children, and disabled and elderly adults. In these states, relatively few able-bodied adults with children qualify and only at incomes well below the federal poverty line. Moreover, childless adults do not qualify at all.

Prior to the implementation of the ACA, 19.6% of Blacks were uninsured, compared to 13.1% of Whites. Under the ACA, the disparity in coverage between Blacks and Whites dropped from a 6.5 percentage-point gap to a 5 percentage-point gab. If no more states expand Medicaid, 11.1 million Whites are projected to gain coverage by 2016, which is a 52% reduction in the number of uninsured Whites. And, about 2.9 million African Americans are expected to gain coverage, which is a 42% reduction in the number of uninsured Blacks. If all states expanded Medicaid coverage, however, the divide in coverage between Blacks and Whites would drop to just 2.6 percentage points, according to the Urban Institute.

The Impact of Location The Urban Institute stresses that “where you live matters.” A

disproportionate number of Blacks live in the South. The strongest resistance to Medicaid expansion also exists in these southern states. Approximately half (11 out of 23) the nonexpansion states are located in the South and roughly 86% of those in the coverage gap reside in the South. The South has higher uninsured rates and eligibility requirements for existing Medicaid programs are more stringent than in other places. For example, in Mississippi, the parent/caretaker in a family of three would be ineligible for Medicaid if he/she earned more than $384 per month. 25% of those in the coverage gap live in Texas which has a large uninsured population as well as limited Medicaid eligibility. 17% live in Florida, 9% in North Carolina, and 7% in Georgia. If these nonexpansion states proceed to expand Medicaid programs, the Black-White disparity would dramatically shift. The Impact on the Health and Stability of Black Communities The State of Black America 2014 reports that the ACA is the most potent legislation for reducing health disparities since the creation of Medicare and Medicaid. The ACA has the potential to expand opportunities for healthier lives among Americans. If every state expanded their Medicaid programs, 95% of uninsured African Americans would be eligible for assistance with Medicaid, a Marketplace plan, or Children’s Health Insurance Program (CHIP). The 2013 State of Black America report highlights that African Americans have higher rates of death than any other racial groups for major cancers such as colon, prostate, lung, and stomach. Data from the US Department of Health and Human Services (DHS) confirms

these findings and further reports that

African Americans are more

likely to die from cancer than any

other racial or ethnic group;

African Americans are diagnosed

with HIV AIDS at nine times the

rate of Whites;

African Americans are more

likely rely on emergency room

services for their health care than

Whites;

African Americans are 40% more

likely to have high blood

pressure;

African Americans are twice as

likely to be diagnosed with

diabetes and obesity;

African American women are

40% more likely to die from

breast cancer;

Mortality rate among African

American infants is more than

twice that of non-Hispanic White infants.

The disparities listed above are only some of the health-related challenges facing Black communities. The National Urban League also notes that African Americans are less likely to have access to health insurance. While research demonstrates that people with insurance are more likely to be healthier than those without, the relatively high percentage of African Americans without coverage partially contributes to these disparities. Age is another significant factor. Importantly, more than half those in the coverage gap are middle aged (35-54) or near elderly (55 to 64). Due to being uninsured, these adults may leave increasing health needs untreated. Additionally, research shows that the uninsured are not as likely as those with insurance to obtain preventive care and services for major health conditions and chronic diseases. Research suggests

that uninsured people in this age range may leave health needs untreated until they become

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for major health conditions and chronic diseases. Research suggests that uninsured people in this age range may leave health needs untreated until they become eligible for Medicare at age 65 (McWilliams et al, 2007). On the occasions that they do seek such care and services, they are often faced with unaffordable medical bills. According to Community Catalyst, expanding Medicaid and closing the coverage gap will be hugely beneficial to African Americans in particular. Without insurance, poor working people are left with few options often relying on emergency rooms or the limited number of community health care centers that offer free or discounted health services. Rev. Derrick Harkins of Enroll America explains that “Securing health coverage is part of the larger conversation about securing and stabilizing our community.” Harkins further states that the economic, social, and family stability of Black communities is inextricably tied to health coverage.

McWilliams, J.M., Meara, E., Zaslavsky, A.M., Ayanian, J.Z. (2007). Use of health services by previously uninsured Medicare beneficiaries. New England Journal of Medicine 357(2): 143-153.