Healthcare Reform Law to Benefit Uninsured and Unemployed Americans, Report Finds

Unemployed Americans who skipped needed care or did not fill prescriptions after losing their health insurance will have expanded options once the major coverage provisions of the Affordable Care Act are implemented in 2014, a new report from the Commonwealth Fund finds.

Based on the 2010 Commonwealth Fund Biennial Health Insurance Survey (54 pages, PDF), the report, Realizing Health Reform's Potential: When Unemployed Means Uninsured: The Toll of Job Loss on Health Coverage and How the Affordable Care Act Will Help (18 pages, PDF), found that 72 percent of respondents who lost their jobs and, subsequently, their health insurance over the last two years are not receiving the health care or medicine they need, while roughly the same proportion is struggling with medical bills or debt. The report also found that of the estimated fifteen million working-age adults who lost their jobs and employer-based insurance between 2008 and 2010, nine million became uninsured, with more than half of those surveyed, 57 percent, saying they became uninsured because of the limited options for acquiring affordable health insurance.

Those options include the Consolidated Omnibus Budget Reconciliation Act (COBRA), which is designed to help people employed by companies with twenty or more workers and have employer-based health insurance to keep their insurance for up to eighteen months if they lose their jobs. However, COBRA — like the individual insurance market — often is not an option for those who need it most, as many unemployed workers cannot afford it or are not eligible to receive it. According to the report, only 25 percent of workers with incomes less than 133 percent of poverty (just under $30,000 for a family of four in 2010) would have been eligible for COBRA if they had lost their jobs, compared with 73 percent of workers with household incomes at 400 percent of poverty or more (just over $88,000 for a family of four in 2010). While the American Recovery and Reinvestment Act of 2009 substantially offset the cost of COBRA for some unemployed workers, covering 65 percent of their insurance premiums, the subsidies have not been offered to newly laid-off workers since last year.

When the health reform provisions take effect in 2014, Medicaid will expand to cover single adults earning up to $14,484 a year and families of four making up to $29,726 a year; sliding scale premium tax credits to purchase private policies through new state insurance exchanges will be available for single adults earning up to $43,560 and families of four making up to $89,400; and participants in the new exchanges will benefit from new consumer protections that assure they won't have to pay high premiums or be denied insurance because of pre-existing conditions. Between now and 2014, the report's authors recommend that policy makers continue with the current protections in place for unemployed Americans and re-establish the COBRA subsidies that helped millions who lost their jobs during the recession to keep their health insurance.

"Clearly COBRA subsidies made a big difference for millions of unemployed people who had no other option for affordable health insurance coverage," said Commonwealth Fund vice president Michelle Doty, a co-author of the report. "As the economy continues to struggle to recover, extending those subsidies would assure that workers, particularly those with lower incomes, could maintain their health insurance."