Barriers to Insurance Expansion Under Reform Law Could Hinder Effort

The expected expansion of health coverage under the federal health reform law could face a number of barriers, according to an Urban Institute report released Tuesday, CQ HealthBeat reports.

The federal health reform law is projected to increase insurance access through expansion of Medicaid, new tax credits and state-based health insurance exchanges. However, the report found the process of expanding health coverage could be hampered by several factors, including:

• Outdated technology;
• Complicated enrollment procedures; and
• Financial and political obstacles.

The reform law initially provides a 100% federal match for the costs of Medicaid beneficiaries who become eligible through the overhaul's coverage expansion. However, the higher matching rate would not apply to individuals who previously were eligible for Medicaid but did not enroll. As a result, states are "rightly" concerned that an increase in Medicaid enrollment could result in pressure on state budgets, according to Urban Institute Senior Fellow Stan Dorn (Adams, CQ HealthBeat, 6/7).

Parents' Coverage Could Be Barrier for Covering Kids

The report also found that children could face numerous challenges in obtaining coverage under the overhaul because of complex coverage options and family situations, National Journal reports.

Urban Institute research associate Stacey Morrow noted that federal subsidies to help individuals purchase coverage through the state-based exchanges are available only to workers who "have an affordable employer-sponsored insurance offer." Morrow added that current interpretation of the law indicates that if the offer for employer-based individual coverage is affordable, no one else in the family is eligible for the exchange subsidies.

Further, parents who opt out of employer-based plans in favor of family coverage under the exchanges could be ineligible for subsidies if the employer-sponsored plan would be less than 9.5% of household income.

Urban Institute researchers are drafting proposals for HHS to alter rules on federal subsidies to ensure that children are able to access health coverage under the reform law (National Journal, 6/8).