By Anne Swerlick, Senior Policy Analyst & Attorney at Florida Policy Institute – September 30, 2022
What if you had to choose between paying next month’s rent or buying your child’s prescription? Medicaid spares millions of families from this dilemma. For more than 50 years, Medicaid has been a lifeline health insurance program for those unable to afford private insurance. Research shows that children who are covered under the program do better in school, stay healthier as adults, and achieve more economic success than those without coverage. Likewise, parents who are covered are better able to care for their children. Medicaid also provides peace of mind for families otherwise facing financial ruin triggered by a costly catastrophic illness.
However, there are persistent historical barriers for people to get care. This leads to significantly poorer health outcomes, particularly for people of color. While these disparities have existed for years, they have been dramatically exposed by the devastating impact that COVID-19 has had in communities of color.
The current structure of Florida’s Medicaid program exacerbates barriers to care. Notably, it does not cover any adult without children, and for those with children, parents in a three-person household cannot have income of more than 33% of the poverty level, or — for example — $6,807 in a three-person household. Yet, this same household cannot get help to purchase private insurance through the Affordable Care Act (ACA) Marketplace unless they have income of at least $31,795. Nearly 60 percent of the people who fall into this health care coverage gap are people of color. Extending coverage to people in the gap through Florida’s Medicaid program provides a unique and valuable opportunity to reduce stark health disparities and achieve greater health equity for all Floridians. In order to realize Medicaid’s full potential though, significant program design and policy changes are needed.
Achieving Health Equity: Challenges Posed by ‘States’ Rights’ Foundation
A common saying among Medicaid experts is: “[i]f you’ve seen one state Medicaid program, you’ve seen one state Medicaid program.” Hidden behind this refrain is the cruel reality that residents in some states can get Medicaid coverage while their neighbors in identical circumstances in another state remain uninsured.
Since its creation, Medicaid has been built on a foundation of “states’ rights.” Although this legal construct is intended to generally promote the rights of individual states from interference by the federal government, at its core, the doctrine is rooted in the movement to preserve slavery in the lead up to, during, and after the Civil War.
Congress continued the states’ rights legacy through its design and enactment of the Medicaid program in 1965. Federal Medicaid law then and now grants states broad flexibility to determine which categories of people it covers, at what income levels, and the specific benefits covered. This has driven years of political debate at the state level on who the “worthy poor” are deserving of health care coverage.
Notably, the Medicare program was created on the same day as Medicaid, but the two programs have radically different designs. Medicare is a national health care program serving all people 65 and older and people with disabilities. It has uniform eligibility and coverage across all states. Medicare policy is determined and implemented at the federal level: states do not have a role.
A common saying among Medicaid experts is: “[i]f you’ve seen one state Medicaid program, you’ve seen one state Medicaid program.” Hidden behind this refrain is the cruel reality that residents in some states can get Medicaid coverage while their neighbors in identical circumstances in another state remain uninsured.
Unlike Medicare, Medicaid was built on the foundation of New Deal policies and earlier cash assistance safety net programs. When Social Security was enacted in 1935, Southern states successfully pushed for policies excluding farm and domestic workers, who made up more than half the nation’s Black workforce. In the same year, Southern states insisted on state and local control of eligibility and benefit levels when federal funding was made available to assist children living with a single mother through the Aid to Families program (renamed Aid to Families with Dependent Children of AFDC in 1962). Like the Social Security exclusions, this enabled states to preserve an economic system that relied on low-wage Black workers in the South and Latino/a workers in the Southwest. Throughout the history of Florida’s cash assistance programs, ugly stereotypes about Black families have driven harsh policy choices, including time limits for benefits and stringent work requirements, that ultimately harm all Florida families who rely on a strong safety net for critical support.
Medicaid’s “States’ Rights” Framework is Rooted in Racism
Today, the “states’ rights” argument has been used to block federal policies that would improve health care for everyone by expanding access to services and programs and reducing racial inequities in access to care.
In crafting the Affordable Care Act, Congress intended to correct the injustice of state Medicaid programs that excluded millions of uninsured adults and children from coverage. Specifically, the ACA requires all states to provide Medicaid coverage for both adults and children up to 138 percent of the federal poverty level (FPL), which is $18,762 per year for a single person and $31,795 for a three-person household.
However, this requirement to expand state Medicaid programs to adults was challenged by the state of Florida and 25 other states. With a strong nod to “states’ rights,” the U.S. Supreme Court in 2012 held that this ACA requirement as applied to adults was unconstitutionally coercive on states. This judicial re-write of the ACA effectively made Medicaid expansion to adults voluntary for states. Thirty-eight states have opted in. The 12 states that have not yet made the decision to provide health care for 2.2 million uninsured people by expanding Medicaid are mostly states that were part of the Confederacy, including Florida.
Refusing to expand Medicaid has further entrenched long standing health disparities, thwarting the intent of the ACA. In Florida, nearly 26 percent of people left out of coverage and falling into the coverage gap are Black; 28 percent are Hispanic; and 42 percent are white. Their income is simultaneously too low to qualify for premium subsidies on the federal marketplace and too high to meet stringent state Medicaid income eligibility caps.
The 12 states that have not yet made the decision to provide health care for 2.2 million uninsured people by expanding Medicaid are mostly states that were part of the Confederacy, including Florida.
State lawmakers’ ongoing refusal to expand Medicaid is one of the most recent and highly visible policy choices reinforcing structural racism in the Florida Medicaid program. Although Florida policy leaders have attempted to justify their resistance by voicing “budget concerns,” these objections belie the overwhelming evidence that the state could actually save millions of dollars by moving forward on expansion.
Research shows that expansion resistance “is driven by assumptions about whether, or to what extent racial and ethnic minority groups or ‘foreigners’ will benefit…” and when white people’s support of expansion is low, the state is less likely to expand Medicaid.
In addition to refusal to expand Florida Medicaid, there are numerous other examples of state Medicaid policy choices made by lawmakers that disproportionately hurt people of color. These choices have been made through state “options” reflected in Florida statute, rules, and the slippery slope of section 1115 Medicaid waivers. They include stringent income eligibility caps for parents, seniors, and people with disabilities; limited home and community-based services that would enable people to remain in their own homes instead of institutions; and other restrictions excluding coverage of medically necessary care.
Recent Policy Changes Advance Health Equity in the Medicaid Program
State policymakers have recently enacted changes to advance a more equitable Florida Medicaid program. This includes extending post-extending post-partum Medicaid coverage from 60 days to 12 months and requiring Medicaid managed care plans to collect and publish performance data relating to various health indicators broken down by demographic characteristics, including race and ethnicity. Public debate fueling momentum on both initiatives included data showing stark racial disparities on various health care indicators. For example, maternal mortality rates for Black women are more than three times higher than they are for white women are due to “variation in quality of healthcare available, underlying chronic conditions, structural racism and implicit bias.”
Additional Policy Changes Needed for a More Equitable Medicaid Program
There is great potential to address systemic racism in health care through a more equitable Medicaid program. This includes providing for more generous eligibility criteria and covered services, as well as reversing years of state policy decisions that cause Medicaid cuts.
Thousands of Floridians, including a large share of people of color, remain uninsured because of state leaders’ failure to expand Medicaid. Having insurance is vital to accessing care and living a healthy life.
State lawmakers have, over the years, incrementally reduced the Medicaid income cap for the program serving seniors and people with disabilities (the MEDS-AD program) to below-poverty levels. MEDS-AD is a primary source of home and community-based services (HCBS) that allows people to stay in their homes and avoid nursing home placements. Research shows that Black people face greater barriers than white people to paying out of pocket for HCBS. Thus, a greater share of aging Black people only have the option of an institutional, nursing home placement rather than being able to remain in their own homes with HCBS.
Florida’s very restrictive coverage of oral health, particularly for adults, is based on a 2003 law. State lawmakers’ choice to limit coverage to dentures and emergency services disproportionately hurts people of color. According to a 2016 Florida Department of Health study, complete tooth loss is highest among Black people, and the lowest prevalence of an annual dental visit occurred among Hispanic adults and Black adults.
Thousands of Floridians, including a large share of people of color, remain uninsured because of state leaders’ failure to expand Medicaid. Having insurance is vital to accessing care and living a healthy life.
The states’ rights doctrine gives lawmakers discretion to exclude life-saving benefits offered under Medicaid. The same doctrine that allowed states to limit programs like Social Security and other cash assistance programs on the basis of race is still being used today. This doctrine harms people of color and has hollowed out programs that are designed to be an essential safety net for all people. Medicaid policy changes that address healthy equity would go a long way towards achieving better health outcomes for all Floridians. This is a key moment for Florida leaders to muster the political will and commitment to do so.