Research & Policy
Policy Matters Ohio

Medicaid premiums prevent access to care

February 18, 2015

Medicaid premiums prevent access to care

February 18, 2015

Kasich proposal would work against the goals of Medicaid expansion to provide access to health care and stabilize health system finances

Contact: Wendy Patton, 614.221.4505

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Monthly premiums that the Kasich administration wants to charge some Medicaid recipients could backfire because they will pose a serious barrier to health care for some, a Policy Matters Ohio report says.

People unable to afford the premiums may delay treatment or turn to emergency rooms, which will drive up costs.

More than 490,000 Ohioans whose wages are too low to buy insurance signed up for Medicaid health care coverage in Ohio under the Affordable Care Act's Medicaid expansion. They can now see a doctor to manage chronic conditions such as diabetes and high blood pressure, and prevent serious illness. As more people see a doctor, fewer come into the emergency room with medical crises and without insurance.

This is good for patient health and good for health system finances, said Policy Matters Ohio researcher Wendy Patton. "This also controls health-care costs for the rest of us. Imposing monthly premiums on poor people could put this virtuous cycle in reverse," Patton said.

The Kasich administration has proposed a reauthorization of Medicaid expansion to provide coverage for working-poor adults. But the executive budget released February 4 has added a requirement that some adults with income between 100 and 138 percent of poverty - $11,770 to $16,242 in annual earnings for a single person - pay a monthly premium for coverage. These men and women would pay a premium of $20 a month, on average, in addition to co-pays for medical services.

Cost-sharing through insurance premiums and co-payments is standard in the health care system, but can keep the poor from seeking and affording care. Their limited incomes are spent to meet other basic needs, such as food and shelter.

A substantial body of research has found that requiring a financial contribution discourages low-income people from seeking health care and, in some cases, leads to an increase in expensive emergency room treatment that goes unpaid, the report said.

The report also found that in some states, the cost of collection and monitoring exceeds the value of premiums. And because many low-income families have no bank accounts, they must shoulder added costs to pay premiums with money orders.

"Requiring premiums for access to health care works against public health and a more efficient, effective health-care system. It's a lose-lose strategy," Patton said. "The goal of policymakers should be to reduce barriers to care and encourage participation, allowing individuals to lead healthier, more productive, financially stable lives."

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