Michael Brewer

Medi-Gap: Budget Cuts Threaten State Health Plans



Posted: Wednesday, February 03, 2010

by Michael Brewer
Communicatia, Inc.



The great health care debate is arguably creating another social class category separating the "haves" and the "have-nots."

Now that so many individuals have lost their jobs and group health insurance to go along with them, many Americans are suddenly finding themselves in the "have not" column for the first time in their professional lives. For them, there's short term health insurance for temporary life events. For others, there's Medicare or another federally subsidized health insurance program. For individuals and families who do not qualify under standard income requirements necessary to get benefits, there's usually a state-run health insurance trust to cover basic medical care.

But borrowing a catch phrase from the Reagan era that put Medicare supplement insurance providers in business, the "Medi-gap" is getting bigger as state budgets get smaller. Washington state announced it will be shutting down its low income health insurance program this summer. That means some 65,000 residents will be joining the rolls of the insurance have-nots unless Congress passes special legislation that would allow the program to continue.

The U.S. Census Bureau estimates that about 250,000 people in the United States receive health benefits under a state program because they either don't have children or dependents in their household or make too much money under the Medicare threshold. Although a small minority, it's a minority that's growing by the day. USA Today provides a snapshot of some of the most vulberable state medical insurance programs across the country:

Washington - basic Health - the first state-subsidized program of its kind when it began more than two decades ago -- will fold by July unless lawmakers find $160 million in new revenue. About 300 people a people a day are added to its waiting list.

Tennessee - CoverTN, which subsidizes insurance for workers at certain small businesses and adults earning less than $55,000 a year, Republican Governor Jodi Rell, says, unless lawmakers find more money.

Connecticut - Charter Oak, which offers residents for doctor visits in March to $10-$20 and add a $1,000 maximum annual charge for hospital care. The waiting list more than doubled in 2009, from 165,000 to 353,301.

Minnesota - The General Assistance Medical Care program, which covers adults earning less than $8,000 per year, will end in March unless lawmakers find an alternative.

With state Medicaid program money running out in December, it will be up to the Feds to throw a meaningful lifeline out to the have-nots.

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