The Billion Dollar Hard Sell: Obamacare's Slow Start in Indian Country
The Affordable Care Act—Obamacare—remains a hard sell in Indian country.
The first comprehensive report from government data show that key measures, such as the purchase of insurance, reflect only about 3 percent of eligible American Indians and Alaska Natives buying from a marketplace exchange. The result is that more than a billion dollars in tax credits—as well as additional tens of millions of increased funding for the Indian health system—is left behind and unclaimed.
And nearly a million American Indians and Alaska Natives remain uninsured during the first year of this new law.
Still, the Affordable Care Act has the potential to radically shift the funding mechanisms for the Indian health system. The way the law is supposed to work is to give American Indian and Alaska Natives additional insurance options. This is critical because under current law, Congress appropriates $4.4 billion for Indian health and that amount is not nearly enough to fund the Indian health system. But the Affordable Care Act promotes new revenue, money from private insurance, Medicaid, Medicare and other payers, that's currently budgeted at $810 million. But even that total, $5.2 billion, is not nearly enough. The Indian Health Service estimates that its per person spending under this formula is $2,849 compared to $7,713 per person spending for the U.S. population.
So the idea is that third-party billing from insurance will eventually eliminate the funding gap. If enough people from Indian country get insurance from all sources, there is the potential for a fully funded health system. Ideally, every patient would be educated about their insurance options (often at no cost) while they are are at a health facility.
But a fully funded health system remains a far off promise.
The Affordable Care Act has had many problems in its first form. The healthcare.gov web site did not work and there is much confusion about the available options for American Indians and Alaska Natives. Indeed, much of the early marketing for the Affordable Care Act was to educate Native Americans about the exemption from the insurance mandate instead of explaining why insurance could improve funding for the entire Indian health system.
The Affordable Care Act sets out to increase funding for Indian health programs in three ways: Expand Medicaid eligibility; help people purchase insurance (called Qualified Health Plans) on their own; and add new insurance requirements for employers.
“IHS has estimated that the greatest impact for our patients is likely to be the Medicaid expansion and we estimate much greater potential for third party collections through Medicaid enrollment,” according to Raho Ortiz, IHS’ director of the business office enhancement. “In the FY 2014 President's Budget Request, IHS estimated collections from private insurance due to the Affordable Care Act to increase by $5 million, and collections due to the Medicaid expansion to increase by $95 million if all states adopted the expansion.”
That’s where the political debate about the Affordable Care Act is impacting the budget because so many states have opted out for political reasons. Alaska, Oklahoma, Montana and South Dakota are among the states that rejected the Medicaid expansion. Of the nearly one million uninsured American Indians and Alaska Natives, more than 460,000 live in states without Medicaid expansion. Thus, Ortiz said, the “estimates for Medicaid collections would be lower.”
Next year’s IHS budget estimates that collections from private insurance may not change, but the potential increase from Medicaid collections is $22 million. “Many of our patients are finding when they enroll in the marketplace that they are newly eligible for Medicaid in those states that have implemented the Medicaid expansion and therefore do not need to purchase insurance,” he wrote in an email.
Ed Fox, director of Health Services for the Port Gamble S’Klallam Tribe of Washington, compiled national data for his website, Health Care Reform for American Indians and Alaska Natives.
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