Health care coverage is critical to ensuring patients’ access to care, which supports their own individual health, as well helps prevent the further spread of COVID-19. The economic stress of the public health emergency already has cost millions of jobs and is therefore expected to increase the number of individuals and families without coverage. The social safety-net, specifically, the Medicaid program, is struggling to meet the surge in demand, particularly as states are facing dramatic declines in revenue. The Department of Health and Human Services is using a portion of the Public Health and Social Service Emergency Fund authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act to cover the costs of the uninsured. This approach will quickly deplete the emergency fund, leaving it unable to achieve its other objectives; will fail to establish a regular connection between patients and providers to help facilitate public health interventions; and will reduce health system resources by reimbursing providers less than the cost of delivering care.
We urge Congress instead to prioritize maintaining health benefits for individuals and families and increase coverage options for those who are already uninsured by:
- Authorizing Employer Subsidies for Preserving Enrollment. Many employers experiencing loss of revenue as a result of the economic downturn may choose to reduce benefits as one way to manage expenses. Congress could help employers maintain benefits by providing employer subsidies explicitly for the purposes of preserving enrollment in health coverage during the public health emergency.
- Covering COBRA Costs. The COVID-19 public health emergency has already triggered significant job loss. Many individuals may have the option to maintain their job-based health coverage through the Consolidated Omnibus Budget Reconciliation Act or COBRA but find the costs to be prohibitive, especially if they are facing a significant reduction in income, as they are expected to cover the entire cost of the monthly premium. Congress could offset the cost of COBRA coverage to former employees through a direct subsidy or refundable individual tax credits.
- Increasing Eligibility for Federal Subsidies. Some individuals and families make too much money to qualify for Health Insurance Marketplace subsidies but too little to afford premiums. This is particularly true for lower-income families who would be eligible for marketplace subsidies except for a “glitch” in the law that miscalculates how much families can afford. Congress could increase access to individual market coverage by increasing eligibility for federal subsidies and fixing the “family glitch.” Subsidy increases could be done in one of two ways: increasing the eligibility threshold to 600% of the federal poverty level or by providing subsidies for any individual or family for whom premiums exceed a certain portion of household income, e.g., 8.5%.
- Expanding the Period during which Insurers Cannot Cancel Coverage for Non-payment of Premiums. Today, insurers in the Health Insurance Marketplaces cannot disenroll someone for non-payment of premiums until they have failed to pay for three months of coverage. Congress could prohibit all disenrollment for non-payment of premiums during the COVID-19 public health emergency. In doing so, Congress should require that insurers must continue to reimburse providers for the services delivered to those individuals.
- Providing Charity Care Tax Credits for Hospitals. Inevitably, gaps in health care coverage will remain despite efforts to preserve and expand enrollment. In order to cover the costs of the remaining uninsured, Congress could provide tax credits for hospitals to offset 90% of the COVID-19-related charity care furnished by a hospital in 2020.