by Rob Thompson
Good news from Raleigh! The NC Health Care for Working Families Act, H655, is a new bill to bring affordable health care to hard-working North Carolinians in all 100 counties. This is a North Carolina-solution to close the health insurance coverage gap. The bill was introduced by conservative legislators, which is critical for its chances of moving forward in our Republican-led state legislature.
Extending coverage to low-income families would have positive benefits for everyone in North Carolina, not just those who gain coverage, most of all by reducing the cost of healthcare for everyone. Evidence from other states shows that this will also increase the rate of infants who survive to their first birthdays, make it possible for more people to get treatment and recover from substance use, and strengthen family finances.
While H655 includes elements that will prevent some people from enrolling and staying enrolled (more on that below), it is a pragmatic proposal for closing the healthcare coverage gap that can gain traction on both sides of the aisle. Now we need our leaders from both parties to come together on a compromise that will get affordable, quality health care to the greatest possible number of uninsured people in North Carolina, in the most cost-effective way possible.
Sponsored by Rep. Donny Lambeth, H655 would create a new health insurance option for all adults under 133% of the Federal Poverty Line (that’s $28,370 a year for a family of three). It would be administered by the managed care companies who recently won contracts to implement North Carolina’s Medicaid program, and would be available by July 1, 2020. The federal government pays 90% of the cost. The other 10% would be covered by hospitals and private managed care companies, who stand to gain significantly when large numbers of people are no longer uninsured. Other states who have created such plans have actually seen significant budget savings as a result.
To be eligible for the plan, participants must pay a premium, report their work hours monthly, and participate in “health and wellness” activities. While these requirements sound reasonable in theory, they are very likely to have unintended consequences. NC Child has serious concerns about the premiums and work reporting requirements in particular. Here’s why:
Premiums are a real barrier for the working poor. The bill requires all participants with incomes over 50% of the federal poverty line to pay 2% of their annual incomes as a premium. Let’s do the math for a a family of four (2 parents and 2 children) that’s trying to get by on a budget of $1,100 a month. The premium for the two parents to enroll would come to $44 per month ($22 / person). That’s a difficult expense to incorporate into a tight budget. For the families who most need affordable coverage, it’s easy to see how quickly this could become a very difficult choice between buying food for your kids and paying for your own health insurance. Emerging data from other states shows that’s exactly what happens – premiums lead to significant reductions in enrollment.
Work reporting requirements also come with serious challenges. In Arkansas, the only place where these requirements have been implemented, more than 18,000 people have lost coverage. The vast majority of people losing coverage actually do work and meet the requirements, but the overly complex monthly reporting system shut them out. To make matters worse, a federal judge recently ruled that these work reporting requirements are actually illegal under federal law.
Despite its shortcomings, the NC Health Care for Working Families Act is a huge step forward. We commend the bill sponsors for introducing this proposal, and we look forward to working with them to advance the best bill possible. NC Child is on board because we want the best outcomes possible for North Carolina’s kids – and that means they need healthy parents who can take care of them.
P.S. Has your state legislator joined the NC Health Care for Working Families Act as a sponsor or co-sponsor? Be sure to say thank you. We need as many co-sponsors as possible in order to advance the best legislation.
Rob Thompson is NC Child’s Deputy Director.
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