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ACA Insurance in the Time of COVID-19

The urgency of the pandemic ushered in important changes to the Affordable Care Act (ACA), including a steep reduction in premiums for health insurance policies purchased on the state and federal exchanges through the end of 2022. Now Congress is debating reforms such as making the larger premium subsidies permanent and broadening the reach of the federal-state Medicaid program beyond the expansion introduced in the 2010 ACA.

We spoke with Tyson Lester, an independent insurance agent in southern California, about what the changes so far have meant for consumers. Tyson is licensed to sell policies in California, Florida, and Texas.

Tyson LesterTyson Lester

Has the Affordable Care Act promoted disease prevention and care during the pandemic?

Some of the best feedback we got from our clients was about using the telehealth and remote options in their policies. It’s been an option for quite some time, but it was utilized more frequently during COVID-19. People were able to access primary care physicians, receive consultation and be diagnosed with COVID over the phone. It was amazing. It helped them because: 1) they were able to just make a phone call; 2) they were able to receive good consultation; and 3) if testing was necessary, they were able to go to a testing facility.

In response to COVID, did you see a rush into ACA policies last year?

ACA enrollment increased last year, but consumers’ response to the pandemic was mixed. In 2020, 12 states and Washington D.C. temporarily reopened their health insurance exchanges but people didn’t have the additional premium assistance to make it more affordable. In the remaining states, working people who lacked employer health insurance didn’t have the ACA as another option for coverage when the pandemic hit.

As for the workers who did have employer health insurance last year but then lost their jobs, they had to make a tough decision between whether they wanted to elect their employer’s COBRA, which is expensive, go uninsured, or go on the insurance exchange. But many people weren’t fully aware of the ACA’s longstanding option: when someone loses group health insurance from their employer, they can buy what’s known as a special enrollment ACA plan. In Texas, for example, part of the reason for last year’s increase in the uninsured population, in the midst of COVID-19, was that people who lost their jobs – and their employer coverage – weren’t even aware the ACA exchanges were available to them. We actually put a flyer together for this specific topic last year, because it was so important.

In March, the American Rescue Plan significantly increased the ACA premium subsidies through December 2022. What has been the effect?

For anybody who was previously enrolled, the American Rescue Plan significantly reduced premiums in California, Texas, and Florida and potentially their total out-of-pocket costs. As a result of the larger subsidies, I saw an influx of new customers throughout this year on California’s exchange, which – unlike most other states – opened a special enrollment for all of 2021. Earlier this year, the federal exchange opened, which caused an influx of customers too. This is where Texas, Florida and many other states sell their ACA policies. All states on the federal exchange shut down again in August but will reopen for 2022 in November. …
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State Uninsured Rates All Over the Map

Map of Uninsured rates

A decade after the passage of the Affordable Care Act, about one out of every five Texans under age 65 still do not have health insurance. Georgia, Oklahoma and Florida are close behind.

The contrast with Hawaii, Minnesota, Michigan, and New Hampshire is stark – only about one in 20 of their residents lacked insurance in 2018, the most recent year of available data, according to the Kaiser Family Foundation’s annual roundup of insurance coverage in the 50 states.

Despite this glaring disparity, the share of Americans lacking coverage has dropped dramatically across the board, including in Texas. Texas’ uninsured rate fell from 26 percent in 2010 to 18 percent in 2018. This translates to 2.3 million more people with health insurance. (Large populations of undocumented immigrants in states like Texas can push up the uninsured rate.)

States that had fairly broad coverage even prior to the Affordable Care Act’s (ACA) 2010 passage didn’t have as far to fall. For example, Connecticut’s uninsured rate is 6 percent, down from 10 percent in 2010.

One upshot of these two trends is that the disparity between the high- and low-coverage states has shrunk. Certainly, the strong job market gets credit for reducing the ranks of the uninsured. But millions of Americans who don’t have employer insurance have either purchased a policy on the insurance exchanges or gained coverage when their state expanded Medicaid to more low-income residents under the ACA.

For example, just two years after Louisiana’s 2016 Medicaid expansion, the uninsured rate had fallen from 12 percent to 9 percent.

But the initial benefits of the ACA seem to have played out. The U.S. uninsured rate increased slightly, from 10 percent to 10.4 percent between 2016 and 2018.

The share of people who are underinsured is also rising, the Commonwealth Fund found in a recent analysis. …

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