by Peg O’Connell
A while back, author Malcolm Gladwell wrote the book, “Tipping Point.” A ‘tipping point” is the time when the success of a new idea becomes inevitable and when an old idea slips away into oblivion. The only problem with a tipping point is that you have to be looking back to tell when or what made it happen.
Could we be at a possible tipping point for closing the coverage gap here in North Carolina?
The recently enacted federal American Rescue Plan COVID relief package includes new financial incentives for the states that have opted against expanding Medicaid to provide health coverage for more low-income Americans. In case you have missed my last 38 blogs, North Carolina is one of only 12 remaining states that have failed to find a solution for closing the coverage gap and provide an affordable insurance option for working people. AUGH!
Under the relief plan, states that close their coverage gap under the new law will receive a 5-percentage point increase in the federal match rate for the entire Medicaid Program for two years. This means that during “normal times,” the federal government would increase its match for the program from close to 67% to almost 72% for two years. However, because we are in the middle of a public health emergency (COVID), the current match rate is almost 74%, so the incentive match rate would be close to 79%. This is A LOT of money!
How much money? Well, depending on estimates, it could mean an additional $1.7 to $2.4 billion to North Carolina over the next two years. This would be in addition to other COVID relief funds that will come or have already come to the state AND the 90% match that the federal government has already offered to cover the cost of closing the coverage gap.
North Carolina’s Department of Health and Human Services estimates the state’s cost for closing the coverage gap (that is the remaining 10%) would be $500 million annually. That means $700 million to $1.4 billion in additional funding will come to our state above and beyond the cost to close the coverage gap. For those who say, “we can’t afford to close the coverage gap,” I say, “we can’t afford not to.”
Think of the things that could be done with this extra money, as the state recovers from COVID: telehealth, increased broadband infrastructure, workforce development, more innovation slots for people with intellectual and developmental disabilities…The list is long and very worthy.
These new federal incentives are very generous and should make closing the coverage gap even more attractive to our policymakers. Will this be the “tipping point” for North Carolina? I hope so!