By Lisa Zamosky
As the full implementation of the Affordable Care Act approaches, readers of this blog have asked questions about what’s to come.
Today, I respond to two questions about Medicaid – the government health insurance program for people with limited income. Readers are interested to know how the health reform law will impact the program and their particular situations.
Reader Question: My gross income places me in the federal Medicaid eligible group, however, in my state, Texas, I do not qualify since I am single with no children and am not disabled. I work in the healthcare field and would not want to see any of the Medicaid providers that I am familiar with anyway. Will I be allowed to participate in the Health Insurance Marketplaces if I am willing to pay? Will any of the premium assistance programs be available to me?
Answer: There’s a good chance you will be able to buy a health insurance policy through your state’s marketplace, and qualify for a tax credit. The tax credit will reduce the cost of your insurance premium (the monthly payment you make each month for a health insurance plan).
Under the health reform law, states have the option to expand their Medicaid programs and to extend insurance to many more people. If they do, people like this reader will, for the first time, have access to Medicaid. But not all states are choosing to expand their program. And, Texas is among the states declining the option to do so.
Whether or not you will be able to buy insurance through your state’s marketplace and get help from the federal government to lower your costs will depend on two things:
1. Whether or not your state expands its Medicaid program
2. Your household income
In states that do expand, if you are a single person making $15,856 or less a year, you will qualify for Medicaid.
But let’s say you live in a state such as Texas, and the Medicaid program will not be expanded. If your income is at the poverty level — $11,490 in 2013– and you have no other access to an affordable health plan through an employer, Medicaid or Medicare, you can buy coverage on the marketplace starting October 1 and get a tax credit.
Reader Question: If someone does not sign up for insurance during the open enrollment period, pays the penalty and then gets sick and runs out of money to pay their medical bills, will Medicaid then be on the hook for their bills?
Answer: No, the person on the hook for the medical costs in this situation is you. This is exactly why the choice to not buy coverage is never one’s best option.
If you can afford to purchase a health plan, it’s advisable for you to do so. And remember, most people who buy a health plan through the marketplaces will be eligible for steep tax credits that will lower the cost of coverage.
If you miss the open enrollment period, which will run from October 1, 2013 through March 31, 2014, you will have to wait to buy an insurance policy until the next open enrollment period comes around. If you have an accident or become ill during that time, you’ll be left to pay the penalty for failing to have health insurance as well as any medical bills you incur.
What questions do you have about the Affordable Care Act and how it might impact you and your family? Please ask your questions in the comments section below.