By Phil Galewitz and Andy Miller

At least 2.2 million low-income adults – almost all in Texas and the Southeast – would be eligible for government-funded health insurance under the Democrats’ $ 1.75 trillion Social Spending and Climate Action plan.

This is the number of people who are eligible for Medicaid under the Affordable Care Act but are not insured because they live in one of the dozen states that do not have expanded insurance under the 2010 Act. You’re in the coverage gap – with incomes too high to qualify for Medicaid but below the annual minimum wage of $ 12,880 for an individual to qualify for subsidized coverage in the insurance markets created by the ACA .

According to the Center on Budget and Policy Priorities, an estimated 60% of those trapped in this Medicaid coverage gap are Black or Hispanic. And nearly two-thirds of those in the void live in one of three Republican-controlled states, according to a KFF analysis: Texas (771,000), Florida (415,000), and Georgia (269,000).

According to the plan announced by President Joe Biden after negotiations with key Democratic lawmakers in Congress, those in the loophole would qualify for ACA marketplace subsidies for four years starting in January. They would receive additional cost-sharing protections starting in 2023, which would bring their expenses to zero.

To encourage the existing Medicaid expansion states to maintain their coverage levels, the bill would increase the state matching rate from 90% for the expanding population to 93% from 2023 to 2025.

To pay for that coverage and incentivize the expansion of Medicaid, the plan would permanently cut billions in special federal funding for Medicaid to the non-expansion states starting in 2023, helping hospitals with disproportionately high rates of uninsured or Medicaid patients.

These cuts have unsettled hospital industry officials, who fear that losing these special funds would mean less money to pay for services. “We’re always in favor of expanding coverage,” said Beth Feldpush, senior vice president of America’s Essential Hospitals, which represents hospitals that treat many poor and uninsured patients. “Our concern is that it is paired with cuts in the safety net, and … that is a double-edged sword.”

The American Hospital Association estimates these funding cuts will amount to as much as $ 7.8 billion over 10 years. Industry groups say hospitals will need the additional Medicaid funding to treat the more than 25 million people who would remain uninsured even after the expansion of coverage.

Warnock is a major Senate advocate for health insurance regulations in the Social Expenditure Act.

One benefit for hospitals and healthcare providers is that health insurances in marketplaces generally pay higher reimbursement rates than Medicaid – but they often come with higher deductibles that are difficult for patients and providers to pay for.

The massive spending package depends on Sen. Joe Manchin (DW.Va.), whose support is critical. The Democrats cannot afford to lose a party member’s vote in the 50-50 Senate, where Vice President Kamala Harris would cut ties and the GOP stands firmly against any government expansion. But Manchin has not yet said whether he will vote for the package.

Consumer advocates are thrilled that Congress can no longer wait for relentless Republican-controlled lawmakers and governors to expand Medicaid. Republican leaders have cited a number of reasons for resistance, including that their states cannot afford the 10% requirement and that non-disabled adults do not deserve Medicaid. States could not block the expansion of coverage because it is not covered by Medicaid, which is jointly funded by the federal and state governments.

“This is a big deal,” said Anne Swerlick, a Tallahassee public interest attorney who worked with Florida lawmakers to expand Medicaid. “It would make an extraordinary difference in the quality of life for tens of thousands of Floridaers trapped in the void. In many cases it will be a lifesaver. “

Senator Raphael Warnock (D-Ga.), A key lawmaker advocating the determination, said Congress must “fill the gap in Georgia and the 11 other states where hard-working families wake up every day without health insurance, theirs.” Neighbors in 38 “. other states enjoy. ”But on Wednesday he said he and Georgia’s other Democrats in Congress are opposed to cuts in Medicaid’s special funding for hospitals.

While most states expanded Medicaid in 2014, no state legislature has allowed it to do so since Virginia in 2018. Since 2017, six states have decided to expand on the basis of voting initiatives, most recently Missouri.

Those who didn’t adopt it are in the south, with the exception of Wyoming, Kansas, South Dakota, and Wisconsin. Wisconsin already covers adults up to the federal poverty line on Medicaid, but has not extended it to the ACA’s 138% of that federal level.

In Georgia, Governor Brian Kemp and other GOP leaders have applied for federal approval for a partial expansion of Medicaid that would require work or other activities for eligibility. But the Biden administration has so far opposed this approach.

RD Williams, CEO of Hendry Regional Medical Center in Clewiston, Fla., Said the Democrats’ plan would cover about 60% of the uninsured who use his hospital, which serves one of the poorest parts of the state. “It will definitely have an impact,” he said.


Expanding coverage would help many patients better manage their health by giving them access to general practitioners and specialists. Medicaid applicants make up 25% of Williams patients, while more than 30% have no insurance coverage. “Our largest group of payers are the uninsured,” he said.

However, Williams said he is still trying to figure out how much money he might have to give up on Medicaid funding under the law. These cuts would come if Florida didn’t expand Medicaid.

Elijah Manley, 22, of Fort Lauderdale, Florida, raised more than $ 2,000 in bills after going to a hospital emergency room for treatment for Covid-19 last year. Without insurance, he has no way of paying and fears that this will damage his creditworthiness. He hasn’t been insured since he aged Medicaid when he turned 21.

Manley works part-time in a bar and is also one of several Democrats running for a special area code for a seat in the US state house in January. He hopes Congress will pass a plan that will give him access to free or inexpensive insurance so that he won’t have to think twice about seeing a doctor. “It would be very helpful to me as there are a few things I want to check,” he said, noting that he has a family history of diabetes.

It’s been nearly a decade since the Supreme Court narrowly upheld the ACA in 2012 but made its Medicaid extension provision optional for states.

Joan Alker, director of the Georgetown University Center for Children and Families, said the Democrats’ plan should motivate states to expand Medicaid as they could do so without losing their special Medicaid funding.

“If it moves states, that would be great, but it won’t happen,” said Chip Kahn, president of the Federation of American Hospitals, which represents for-profit hospitals.

Mississippi hospitals welcome the Democrats’ plan despite concerns about funding cuts.


“Hospitals would prefer a direct Medicaid extension, but at this point a thirsty man isn’t going to be really picky about bottled water, bottled water, or tap water,” said Richard Roberson, vice president of the Mississippi Hospital Association. “A reporting opportunity is better than nothing.”

The Medicaid gap has added to the financial troubles of rural hospitals in Georgia, which has led to recent closings, said Senator Jon Ossoff (D-Ga.). About people stuck in the shortfall: “It’s unfair and people suffer and die unnecessarily.”

Anne Dunkelberg, health policy expert for Every Texan advocacy group, said 80% of Texans in the coverage gap live in working households. “I’m not going to party until the ink dries, of course, but I’d love to see coverage for the working poor in Texas.”

Phil Galewitz is a reporter for Kaiser Health News.