Far too many Georgians remain uninsured. Even before the COVID-19 pandemic, 1.4 million people in Georgia had no health insurance, and the state’s 13.4 percent uninsured rate was the third-highest rate in the nation. Georgians also face problems with affordability: The state has some of the highest health care prices yet the lowest state minimum wage in the country. The pandemic has only compounded Georgia’s long-standing health care problems. Black Americans, already more likely to be uninsured than white Americans, are also more likely to be hospitalized or die from COVID-19. And the lack of health system capacity in the northern part of the state has forced Georgians severely ill from the virus to go to Tennessee for hospital care.
Senate Democrats have pledged to protect and expand coverage and affordability, while Georgia’s Republican-controlled state government has refused to take up the commonsense option to expand Medicaid coverage, even as residents face the pandemic’s dual economic and public health crises. At a time when Democrats are proposing new coverage expansions, such as Rep. Lauren Underwood’s (D-IL) bill to expand financial assistance for coverage or President-elect Joe Biden’s public option reform, Georgia leadership has let down its residents by refusing to implement existing, cost-effective options.
In his battle for reelection during the runoff, for example, Sen. David Perdue has been attempting to pin the blame for Georgia’s health care woes on the Affordable Care Act (ACA) and has voted 10 times against protections for people with preexisting conditions. Sen. Kelly Loeffler, also in a runoff, supports a state proposal that will divert enrollment away from health plans that comply with the ACA’s consumer protections and benefit rules and has boasted that she doesn’t disagree with anything President Donald Trump has said or done—presumably including his repeated sabotage of the ACA. In October, Sens. Perdue and Loeffler both voted against defunding the U.S. Department of Justice’s efforts to repeal the ACA, affirming their willingness to strip coverage from more than 20 million Americans.
The irony is that Georgia Republicans have failed their residents by refusing federal dollars to expand Medicaid under the ACA, a move that would have provided health coverage to thousands of uninsured residents and granted a financial boost to struggling rural hospitals.
Georgia’s refusal to expand Medicaid hurts low-income residents
Under the Affordable Care Act, states have the option to extend Medicaid coverage to adults up to 138 percent of the federal poverty level. The federal government provides 90 cents of funding for every $1 a state spends on covering people in this group. States that implemented the ACA’s Medicaid expansion have seen far greater reductions in uninsurance. Medicaid expansion not only directly benefits the newly eligible adults who enroll but also creates a “welcome mat” effect that improves coverage rates among previously eligible yet uninsured children. Studies have shown that state Medicaid expansion results in fewer people with medical debt and increased likelihood of a regular source of care. Medicaid expansion can have positive impacts even beyond health care: Higher levels of Medicaid enrollment were associated with lower rates of eviction among low-income families in California.
To date, 38 states and Washington, D.C., have adopted the ACA’s Medicaid expansion; Georgia is among the 12 that have not. According to the Urban Institute, if Georgia fully implemented Medicaid expansion, 646,000 more Georgians would be covered by Medicaid, not including the additional enrollment that could be expected due to the pandemic-induced economic crisis. Compounding this health care blunder for low-income Georgians, Sens. Perdue and Loeffler have spoken out against further unemployment relief this year. Expansion would reduce the number of uninsured people in Georgia by 30 percent and enable newly eligible workers trapped in unaffordable job-based coverage to reduce their health care costs. It could also provide financial relief to small-business owners: It would lower health care expenses for small firms that employ low-income workers and for self-employed people who would qualify for free or low-cost care under expanded Medicaid.
While the U.S. Senate would not be able to affect what is a state-level option on Medicaid expansion, Democratic members of the Senate are likely to support legislation to build upon the ACA, which could include provisions to extend coverage to the more than 2 million people stuck in the Medicaid coverage gap in Georgia and other nonexpansion states. For example, President-elect Biden proposes allowing people with incomes below the federal poverty level to obtain coverage with no premium through a new public option plan.
Rural hospitals need Medicaid expansion
Medicaid expansion would also reduce Georgia hospitals’ burden of uncompensated care. As the Affordable Care Act took effect, hospital uncompensated care fell, although the relative reduction was more than twice as large in Medicaid expansion states—a 55 percent decrease from 2013 to 2016—than in nonexpansion states. Expanding Medicaid to cover more Georgians would offer a lifeline to the state’s struggling rural hospitals. Dozens of rural hospitals have closed over the past several years, and these closures have occurred disproportionately in states that have not expanded Medicaid.
More than a half-dozen hospitals in rural Georgia have closed since 2010. Just last month, Southwest Georgia Regional Medical Center in Cuthbert closed its doors after 70 years in operation. One-quarter of Georgia’s rural hospitals are at “high risk of financial distress,” according to a 2019 study by researchers at the University of North Carolina, indicating the probability of closure or reduced services at those 17 hospitals is “significantly greater” than that at other rural hospitals.
Struggling Georgia hospitals urgently need help from federal policymakers as well. Hospitals across the country have been strained by COVID-19 and are facing a new surge of coronavirus patients. The pandemic has also caused hospital revenues to drop due in part to deferred care, a challenge that small rural and independent hospitals may not have the financial cushion to survive. Congress provided some relief for providers this past spring, but much of the money initially went to already-wealthy health care systems, and many rural Georgia providers were deterred by the byzantine rules on receiving the funding available from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
The HEROES Act, which was passed by the Democratic-led House of Representatives in May and again in October, would provide an additional $50 billion in relief for health care providers and address other crucial needs, including funding for the public health response and financial assistance for families and small businesses. Senate Majority Leader Mitch McConnell (R-KY) refused to take up HEROES, instead advocating for the less generous HEALS Act, which included just $25 billion for provider relief. In September, McConnell sought to advance a “skinny” version of stimulus legislation, which received votes of support from Sens. Perdue and Loeffler.
Georgia is backtracking on health coverage
Rather than accept generous federal funding to expand Medicaid eligibility under the ACA, Georgia sought and received federal approval from the Trump administration for a plan that will not cover nearly as many people as Medicaid expansion would. Republican Gov. Brian Kemp’s plan also makes Medicaid eligibility conditional upon meeting burdensome work reporting requirements, even though similar requirements in Arkansas have resulted in coverage loss, confusion, and poorer health and financial outcomes, all while failing to increase employment rates. In fact, Georgia’s program adds burdensome reporting requirements to address a virtually nonexistent problem: 93 percent of Medicaid beneficiaries are already working or unable to work due to school, caregiving, disability, or illness.
With full implementation of the ACA’s Medicaid expansion, nearly 650,000 Georgians would gain Medicaid coverage, according to the Urban Institute, and the number of uninsured people in the state would drop by 31 percent. The Georgia plan, by contrast, will increase Medicaid enrollment in Georgia by only 25,000 to 52,500 people over the next five years, and the state will not receive any federal funding for enrollees newly eligible under the plan.
The plan also makes changes to the market for individual health insurance that will divert consumers away from comprehensive insurance that protects people with preexisting conditions and make it harder for them to shop for high-quality plans. Georgians currently use the federally administered HealthCare.gov portal to enroll in ACA marketplace coverage and coverage under Medicaid or the Children’s Health Insurance Program (CHIP). Georgia’s plan would eliminate this centralized portal for enrollment in individual market plans; in the words of the Center on Budget and Policy Priorities, “Georgia’s waiver proposes a free-for-all run by brokers and insurers.”
Web-based brokers and insurers would connect directly with potential enrollees to guide them through enrollment. Because brokers typically receive a higher monthly commission for short-term “junk-plans” that discriminate against people with preexisting conditions than for ACA plans held to rigorous quality standards, they may be incentivized to steer healthier enrollees into cheaper, junk insurance plans, potentially exposing them to astronomical costs if they get sick—and making comprehensive, ACA-compliant coverage more expensive for others.
The HealthCare.gov marketplace includes a “no wrong door” application to connect consumers with the program best suited for them, but brokers on a privatized system would have no obligation to direct people eligible for Medicaid, CHIP, and subsidies toward more affordable options. Medicaid plans generally confer no commission to brokers and agents, so brokers may refuse to help Medicaid-eligible consumers complete the process. They could even direct consumers who don’t know they are Medicaid-eligible to enroll in pricier, private coverage.
Without a Senate majority supportive of the Affordable Care Act, even the possibility of Medicaid expansion remains in danger. Last month, the U.S. Supreme Court heard oral arguments in the ACA repeal lawsuit, in which Trump’s Department of Justice has argued that the entire ACA must be struck down because the law’s individual mandate penalty—which has been zeroed out—is unconstitutional. Over the past year, Senate Democrats and Democratic candidates have espoused measures that would protect the ACA and expand health care coverage. Such proposals would offer important relief to Georgians, including rural providers struggling to stay afloat and residents stuck in the Medicaid gap.
Emily Gee is the health economist of Health Policy at the Center for American Progress Action Fund. Nicole Rapfogel is a research assistant for Health Policy at the Action Fund.