Medicaid gap leaves Obamacare haves and have-nots

April Gomez-Rodriguez hopes Obamacare changes her life.

Daniel Hughes says it’s like the health law never happened.

The difference between them: one state border.

Gomez-Rodriguez and Hughes are both uninsured. They don’t get coverage through their low-wage jobs, but they don’t qualify for traditional Medicaid. There’s no way they can afford to purchase health insurance on their own.

But Gomez-Rodriguez, 32, who works with kids at a behavioral health center, lives in New Mexico, where Gov. Susana Martinez was among the first in the GOP to embrace the Medicaid expansion under the Affordable Care Act. On Jan. 1, Gomez-Rodriguez and her husband will have health coverage for the first time in years.

Hughes, 40, who works in home repair, lives in Texas, where Gov. Rick Perry’s staunch opposition to Medicaid expansion and other key elements of Obamacare shut him out.

It wasn’t supposed to be this way. Obamacare was supposed to create a health care safety net from coast to coast, across income levels, putting everyone within reach of health coverage. But in some states, there’s a gaping hole. In half the states, millions of poor people are left out.

Those gaps weren’t part of the law that Congress passed and President Barack Obama signed in 2010. They are the wreckage of the years of political and legal battles that eroded some of the original promises of Obamacare.

The Affordable Care Act required all states to expand the program to encompass people with household income up to 133 percent of the federal poverty level — about $15,000 for a single person, about $31,000 for a family of four. The federal government would have paid the bill entirely for the first three years and then gradually phased back to a 90 percent contribution.

The Supreme Court changed that. In a 7-2 ruling last year, the court found that it was unconstitutional to require the states to expand Medicaid. It had to be optional. More than half of the nation’s governors have decided not to expand or are leaning in that direction. In an odd quirk of how the law works in the states that opt out, people who are just a tad over the poverty line — from 100 to 133 percent of poverty — can go into the new exchanges and get a subsidized health insurance policy. But the poorest — those with incomes less than 100 percent of poverty, whom the laws’ authors thought they had protected through Medicaid — have nothing.

(POLITICO's guide to the Affordable Care Act)

Texas is the largest of the 26 states to not expand. As the health law rolls out this month, 5 million low-income Americans like Hughes are left with nothing, according to estimates from the Kaiser Family Foundation.

“You can just cheer all over the United States for everyone else but not for me, because I don’t get this opportunity that everybody has worked so hard for,” says Daniel’s wife, Dena Hughes, 44. “Philosophically, [the law] is great. But right here on the streets of Texas, it’s not that big of a difference.”

Hughes just started a new home repair business. It’s hard for him to know exactly what his family will earn, but he estimates it will be just above or below $31,590 — the income requirement for a family of six to get tax subsidies next year. If he’s below it, he’ll remain uninsured. If his new business lets him cross over into a slightly higher income bracket, he may be able to get some help in the exchange.

Texas’s Medicaid program is among the most restrictive in the country. Coverage for poor adults is almost nonexistent because the income requirements are so low — about $4,000 per year for a family of three. Perry said repeatedly that he was skeptical of expanding Medicaid because of the federal promise to pay the Medicaid expansion bill. He said he feared the feds would cut and run, leaving the states with an enormous bill.

But other governors, like Martinez, thought the feds were offering a good deal. In New Mexico, expansion will cover some 170,000 people in a state that has a big problem with coverage despite a large Medicaid program. According to the Kaiser Family Foundation, New Mexico’s Medicaid program covers 22 percent of its population, the fourth highest rate in the country. Even with that help, about one in five people in New Mexico is uninsured, the third highest uninsurance rate in the country.

The Medicaid coverage will be a big relief for Gomez-Rodriguez. Her three kids are already on Medicaid, but she and her husband have relied on charity care at the University of New Mexico hospital. Even the small co-pays they must make are difficult for them to afford, and the hospital is changing its program next year because many of its existing charity care patients will be able to get covered.

“We can’t afford what we have now,” Gomez-Rodriguez told POLITICO. She’s juggling a job at an inpatient behavioral health facility while trying to finish up her criminology and psychology degrees. Her husband works at a restaurant. Together, they’re raising their three children on about $35,000, just within the limit for the expanded Medicaid.

She’s particularly looking forward to dental care, a benefit that New Mexico is including in Medicaid.

“We both have not seen a dentist in forever because we can’t afford it,” she said. Her dental care now consists of “brushing my teeth and flossing my teeth as many times as I possibly can.”

Gomez-Rodriguez didn’t apply immediately when enrollment began Oct. 1. She was wary of signing up too soon, a concern borne out as the exchanges struggle to get off the ground. She’s excited about the coverage option but a little nervous, too. “I was aware of Obamacare, but even then I’m kind of lost,” she said. “I’m going to wait until everything settles down and see what’s going to be available.” Advocates working on the Medicaid expansion can use old-fashioned paper applications if the computer system remains faulty.

Next door in Texas, Perry says the size of the Medicaid population is too much for the state to take on.

“As President Obama himself has said, Medicaid is a broken system,” Perry spokeswoman Lucy Nashed told POLITICO. “It would be reckless and irresponsible to continue adding people and pumping billions of taxpayer dollars into an unsustainable program that already consumes one-quarter of the state’s entire budget. The fact is that expanding Medicaid under Obamacare would lower the uninsured rate in Texas by only 3 percentage points.

Texas health advocates and providers, including the Harris County Health System in the Houston area, lobbied Austin to expand the program in their state, which has the highest rate of uninsured in the country.

“It did not even occur to me that [Perry] would opt out,” said Katy Caldwell, executive director of one of the Legacy Community Health Services clinics in Houston, where 58 percent of patients are uninsured. The clinic was planning a significant expansion to absorb all those new Medicaid patients. But they called it off once Perry made his decision.

Legacy is where Daniel and Dena get their care. Both are HIV positive and get related testing and monitoring under the federal Ryan White Care Act, a health care program for patients with HIV/AIDS. For other health care needs, Dena has health coverage through her consulting job. Daniel, who is self-employed, does not. He’s grateful for the care he gets at Legacy but would rather have an insurance card to go to any doctor.

“I don’t like that I have to use a payer of last resort. I’d rather use insurance, of course,” Hughes said. Ryan White is efficient and helpful, he said, but it still leaves him with unmet health needs.

Hughes says he supports the concept of the health reform law and praises Obama for making it a priority. He worries, though, about how it’s being enacted.

“Healthier people is less disease — period,” he said. “However he needs to make that happen? Great. It’s the knuckleheads in between that start bending dollars, hoarding dollars and misdirecting dollars who scare me. The intention is great, but the process leaves something to be desired.”

This story was originally published on POLTICO.com

Photo Credit: AP