Too Sick to Care: Direct-Care Workers, Medicaid Expansion, and the Coverage Gap

The decision by 21 states not to expand Medicaid has left hundreds of thousands of direct-care workers languishing in the Medicaid “coverage gap,” unable to access affordable health care coverage.

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This problem disproportionately affects workers living in the South, young people, and people of color.

Direct-care workers need access to preventive care and timely health care intervention to live healthier lives. Healthy workers are better able to provide high-quality care to the people they serve.

Policymakers, advocates, and employers all have a responsibility to address this inequity.

Protect and Improve the ACA

To ensure that millions of people, including direct-care workers, can retain their coverage, the Affordable Care Act must be protected from attacks that chip away at essential aspects of the law, such as the recent challenge of the legislation's federal subsidies. Additionally, the ACA should be monitored, assessed, and improved to ensure that each provision is resulting in equitable access to high-quality care.

Expand Medicaid in Every State

State governments should expand Medicaid in every state, reaping benefits for their residents and their state economies. For example, to improve the political feasibility of Medicaid expansion, seven states have asked the Centers for Medicare and Medicaid Services (CMS) to waive certain Medicaid requirements, through 1115 waiver programs. Though these waivers have limitations, they nevertheless allow for enhanced Medicaid enrollment in places where it would be otherwise politically unfeasible.

Additionally, states that have expanded Medicaid eligibility could choose to further expand eligibility, as three states have done for parents or childless adults, or take up the “Basic Health Program”—an option offered in the ACA to make care more affordable and ease churning for individuals with incomes up to 200 percent FPL.

Employer-Sponsored Health Coverage

Providers such as nursing facilities and home care agencies could elect to make employer-sponsored coverage more accessible, particularly if states would create the incentives for providers to do so.

Differential reimbursement rates. To support providers in covering the costs associated with increased wages and benefits for direct-care workers, a handful of states have increased their Medicaid reimbursement rates. Higher rates make it more feasible for providers to offer health coverage to employees. In light of the employer mandate, all states should consider similarly increasing rates to ensure providers can afford to offer quality employer-sponsored health care coverage at affordable rates.

Small-employer pools. Small direct-care providers for whom providing employer-sponsored insurance is particularly challenging could join with other small providers as a pool to negotiate better rates with insurance plans, and in turn help provide coverage to their workers.

Stable work schedules. Direct-care workers are often faced with unpredictable schedules, and most work part-time hours, which makes them ineligible for employer-sponsored insurance even where it is offered. Providers could offer more predictable schedules and guarantee a minimum number of work hours to direct-care workers, helping stabilize their incomes and their eligibility for Medicaid, health care subsidies, or employer-sponsored insurance.

Direct-care Workers in States that Have Not Expanded Medicaid Eligibility Under the Affordable Care Act

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StateTotalUninsuredUnder 138% FPLUnder 100% FPL
Alabama 37,460 11,462 31% 15,658 42% 10,489 28%
Alaska 8,850 2,420 27% 1,832 21% 1,230 14%
Florida 128,390 45,649 36% 40,186 31% 25,421 20%
Georgia 58,280 18,763 32% 21,680 37% 14,803 25%
Idaho 17,790 6,063 34% 6,778 38% 4,305 24%
Kansas 45,110 15,079 33% 16,736 37% 11,232 25%
Louisiana 64,460 26,923 42% 31,070 48% 21,465 33%
Maine 23,380 4,924 21% 5,939 25% 3,484 15%
Mississippi 27,090 9,648 36% 12,461 46% 8,560 32%
Missouri 82,620 24,776 30% 34,535 42%  23,712 29%
Nebraska 20,210 4,376 22% 6,508 32%  3,961 20%
North Carolina 115,730 37,524 32% 44,209 38% 30,206 26%
Oklahoma 38,190 13,527 35% 14,359 38% 9,968 26%
South Carolina 38,810 10,659 27% 15,873 41% 10,129 26%
South Dakota 9,070 1,662 18% 3,084 34%  1,778 20%
Tennessee 54,910 15,236 28% 21,580 39% 14,332 26%
Texas 301,860 133,830 44% 128,592 43% 85,125 28%
Utah 15,140 3,391 22% 4,451 29% 3,013 20%
Virginia 73,600 21,491 29% 22,374 30% 14,278 19%
Wisconsin 77,040 10,876 14% 24,114 31% 16,178 21%
Wyoming 5,320 1,579 30% 1,479 28%  734 14%
Percentages drawn from American Community Survey 2009-2013 ACS 5-year PUMS. These were applied to counts of direct-care workers from the Bureau of Labor Statistics, Occupational Employment Statistics program, May 2014 estimates.

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