Without Medicaid Expansion, 1 Million Texans Lack Insurance Options

Texas has the greatest number of poor, uninsured adults who will fall in a “coverage gap” created by states that chose not to expand Medicaid eligibility under the Affordable Care Act, according to a report released Wednesday by the Kaiser Family Foundation. One million of the 5.2 million Americans who won’t have health insurance options available under the new law reside in Texas, according to the report.

“The ACA was passed with the goal of filling in gaps in the availability of affordable health coverage in the United States,” the report states. “With many states opting not to implement the Medicaid expansion, millions of adults will remain outside the reach of the ACA and continue to have limited, if any, options for health coverage.”

The Kaiser Family Foundation evaluated the number of Americans who won’t have insurance options available under the Affordable Care Act because they live in states that chose not to expand Medicaid and are too poor to qualify for tax credits to purchase private coverage. In Texas, there is a significantly larger number of people who fall in that coverage gap, because the state has such a high rate of people without health insurance and it has comparatively high Medicaid eligibility standards for poor adults.

“People in the coverage gap are likely to face barriers to needed health services or, if they do require medical care, potentially serious financial consequences,” the report says. “Further, the safety net of clinics and hospitals that has traditionally served the uninsured population will continue to be stretched in these states.”

Texas has the highest rate of uninsured in the nation. More than 6 million people — nearly a quarter of the population — lack health insurance, according to census data. And Texas only allows poor parents whose incomes are at 19 percent of the federal poverty level, or about $3,737 a year for a family of three, to enroll in Medicaid.

In other states that chose not to expand Medicaid, according to the report, the median eligibility for poor parents is 47 percent of the poverty level, about $9,400 a year for a family of three.

Because there are so many uninsured Texans, so few of whom are eligible for Medicaid, and because the state decided not to expand Medicaid coverage, the Kaiser report estimates that 27 percent of uninsured adults in Texas will not have coverage options available to them under the Affordable Care Act. That includes 91 percent of uninsured adults whose incomes are below the poverty line.

Beginning in 2014, the Affordable Care Act — commonly known as Obamacare — requires most people to carry health insurance. To help people obtain coverage, the law initially required states to expand Medicaid coverage to adults with incomes less than 138 percent of the federal poverty line, $15,856 for an individual or $32,499 for a family of four. It also gave states the option of creating a state-run health insurance marketplace or participating in a federal marketplace to offer health plan options and federal tax credits to people whose incomes are between 100 percent and 400 percent of the federal poverty line. The tax credits would help the uninsured poor afford health insurance in the marketplace.

The U.S. Supreme Court’s ruling that the federal government could not compel states to expand Medicaid to include impoverished adults created a loophole in the law. As a result, many uninsured people who live in states such as Texas that chose not to expand Medicaid cannot access insurance options available through the law. They make too much money to qualify for Medicaid but not enough to qualify for tax credits to purchase coverage in a state-run or federal health insurance marketplace.

This story was produced in partnership with Kaiser Health News, an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.