Medical Industry Today

Three lobbying groups often on the opposite sides of healthcare issues have joined forces to push for expansion of Medicaid to bring more people under its umbrella along with a tax credit for low-income workers.

The Health Insurance Association of America (HIAA), the consumer group Families USA and the American Hospital Association announced their joint effort last month. Together, they plan to work in the next Congress on a three-part proposal they say would significantly expand health insurance coverage.  

Under the plan:

“Medicaid would be expanded for all people under 65 years of age with annual incomes below 133 percent of the federal poverty level ($18,820 for a family of three). Eligibility would be based strictly on income and would apply equally to parents, children and childless adults. This expansion would be subsidized with enhanced federal funds well in excess of the current Medicaid funding formula.

“As is currently done for children, states would be given the option to provide coverage for parents and childless adults with incomes between 133 and 200 percent of the federal poverty level ($28,300 for a family of three) through Medicaid or a program like the State Children’s Health Insurance Program (SCHIP). This expansion also would be subsidized with enhanced federal matching funds. Both the Medicaid and SCHIP expansions would be developed to ensure optional enrollment of people newly eligible for coverage.

“A non-refundable tax credit would be created to help low-income workers who turn down employer-sponsored coverage because they can’t afford their share of the premium. This credit would be available to employers to help them defray the out-of-pocket premium costs of employees with incomes between 133 and 200 percent of the federal poverty level. For example, if a business currently pays 70 percent of the premiums for all workers in the company, it would receive a tax credit to pay all or part of the remaining premium for its low-income workers.”

At a news conference, leaders of two of the groups acknowledged the proposal would require a “significant public investment” but they said the current economy is quite able to provide it and there never has been a better time to do so.

Chip Kahn, HIAA president, said the alliance was formed because separately the groups and others have held out for their favorite approach “and their second choice always was the status quo,” which accomplished nothing.

Ron Pollack, executive director of Families USA, said forming an alliance on the issue of the uninsured was one way to “transcend partisan, ideological and interest-group boundaries to find common ground so we can move towards health coverage for everyone.”

The White House called the joint effort by the disparate groups an encouraging step. Spokesman Jake Siewert said the Clinton administration hopes the proposals are “something that a future administration will take a hard look at.”

However, The Foundation for Taxpayer and Consumer Rights criticized the joint proposal for falling short “of a systemic fix to the uninsured problem because it leaves intact unreasonable insurance overhead and profit expenditures, as well as abusive industry practices.”

The plan is estimated to cost $250 billion over the next 10 years. Some of those who would be covered already would be covered under a proposal still pending in the current Congress to expand CHIP to cover working families who do not have access to or cannot afford employer-provided health coverage.

Capitol Health Care News reports are provided to MDI for its exclusive distribution, courtesy of IHS Health Information.