by Peg O’Connell
When the American Rescue Plan (ARP) was passed in March of this year, many of us were hopeful that the healthcare provisions in it would be able to close North Carolina’s health insurance coverage gap, but sadly they did not.
Don’t get me wrong, there were many good provisions contained in the ARP. The COVID-19 relief law does expand Marketplace subsidies for those above 400% of poverty and thankfully increases subsidies for those making between 100% and 400% of the poverty level, for two years (2021 and 2022). But, it does nothing to help those at the bottom end of the wage scale—frontline workers, nursing assistants, grocery store clerks and retail workers.
So, despite millions of dollars of federal aid coming to our state, we still have hundreds of thousands of low-wage working people and their families stuck in the coverage gap with no affordable option to buy health insurance.
As a reminder, the coverage gap occurs for people who make too much or don’t qualify for state’s Medicaid program, but make TOO LITTLE to qualify for a subsidy on the health insurance marketplace. It makes me crazy every time I write that.
Let’s look at how this impacts a family of three—a mom with two children. If the mom is working a full-time minimum wage job at $7.25 per hour, the annual income for that family is $13,920 per year. One hundred percent of the federal poverty level for a family of three is $21,720, so this working mom has no hope of getting a subsidy to help her buy health insurance and could not possibly afford to buy health insurance on the private market place. So, she is still stuck in the gap. This mom would have to work almost 70 hours a week in order to bring her family income up to the level where she could qualify for a subsidy on the health insurance marketplace.
This new federal law will give a two-year boost in subsidies to those who already qualified and will create new subsidies for those making more than 400% of the federal poverty level (that is more than $86,880 for a mom with two children). This new law will also guarantee access to a plan with a zero dollar premium payment for people with incomes between 100-150% of poverty. These are all good things, but they are only temporary and not good enough to help our minimum wage mom or her family.
The only fix that can help our mom and her family and hundreds of thousands of low wage North Carolina workers is for our General Assembly to take action and develop a solution to close the coverage gap. The ARP gives us lots of incentives to do so—we need to do it now.