The Department of Health and Human Services recently made news with a report claiming that “National Uninsured Rate Hits Lows in Early 2022.” It sounds encouraging, but look under the covers and what you find is a quiet but big shift from private to government-subsidized coverage.
HHS estimates there are 5.2 million fewer Americans uninsured than in 2020. However, Medicaid enrollments during the pandemic have grown by 24 million—a 34% increase—while two million more adults have enrolled in ObamaCare exchange plans.
Why are so many people on Medicaid when the US unemployment rate has reached a near-record high? A big part of the answer: The Coronavirus First Aid for Families Act of March 2020 barred states from removing people who become ineligible from their Medicaid rolls for the duration of the public health emergency in exchange for a hit to federal funding .
If not for Mr. Biden’s repeated emergency declaration, about 20 million Medicaid enrollees would no longer be eligible, most because their income exceeds the threshold to qualify. Many can now get coverage through their employers, but why pay insurance premiums when Medicaid is “free”?
Thus, taxpayers are faced with a large surprise medical bill. Annual Medicaid spending has increased by $198 billion during the pandemic. That’s as much as Medicaid spending grew from 2012 to 2019 during the first seven years of the ObamaCare expansion. As long as the Biden administration continues the public health emergency — now set to expire on Oct. 13 — Medicaid taxpayers’ tab will continue to grow. And what are the chances that the Administration will not renew the emergency again before the election?
The other explanation for the government taking insurance is the Democrats’ expansion of ObamaCare exchange subsidies in March 2021. As a result, millions of Americans pay no premiums and families making more than 400% of the poverty line receive generous subsidies. The Congressional Budget Office initially estimated that extending the two-year subsidy would cost $22 billion. Current cost: $50 billion.
More Americans enrolled in the exchanges than the CBO predicted, and insurers have taken advantage of the sweet subsidies by raising premiums. However, the CBO strangely projects that the Schumer-Manchin bill’s three-year subsidy extension will cost only $33 billion.
How does CBO figure out that three years of subsidies will cost 34% less than two years? It may expect health care spending to fall as the pandemic recedes, but insurers are now raising premiums to cover Covid treatments they expect the feds will no longer pay for.
By the way, CBO doesn’t take into account the administration’s proposed regulation to fix ObamaCare’s so-called family loophole, which limited exchange eligibility for many individuals who provided family coverage through their employers. The administration estimates the change could make five million more Americans who currently have access to employer coverage eligible for more generous subsidies in the ObamaCare exchanges.
The administration appears to want to push more people into Medicaid and the heavily regulated ObamaCare plans, and thus make more Americans dependent on the government for health care. The government also subsidizes employer coverage through the health care tax deduction, but this is significantly cheaper for taxpayers.
Annual Medicaid and ObamaCare spending has increased by about $230 billion during the pandemic, which works out to about $44,000 per newly insured American. Unfortunately, taxpayers cannot challenge this overage.
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most comprehensive reporting and in-depth commentary in the Golden Triangle, but we need your help to continue our efforts. Please consider subscribing to our website for just $2.30 per week to help support local journalism and our community.