Medicaid out of pocket expenses9/11/2023 ![]() ![]() We reviewed research from 24 papers published between April 2017 and May 2021 on the effects of premiums and cost-sharing on low-income populations (usually defined as at or below 250% of the federal poverty level (FPL)). Research suggested that state savings from premiums and cost-sharing in Medicaid and CHIP are limited, and that increases in premiums and cost-sharing can increase pressures on safety net providers.Ī review of recent studies continues to support earlier research on the impacts of premiums and cost-sharing among low-income populations. Studies also found that even relatively small levels of cost-sharing are associated with reduced use of care and increased financial burden. Research indicated that these effects are largest among those with the lowest incomes. What does the literature tell us about the effects of premiums and cost-sharing on low-income populations?Īn earlier literature review found that premiums serve as a barrier to obtaining and maintaining Medicaid coverage for low-income individuals, with those who lose coverage facing increased barriers to accessing care. In addition, as Congress considers options to provide coverage for people in the coverage gap, understanding the implications of premium requirements may help inform those options. Looking ahead, changing waiver policy under the Biden Administration could also impact the future of Medicaid premiums under Section 1115 waivers. After the PHE ends, states must determine whether and how to resume premium policies. Of the six states that had been implementing Section 1115 premiums prior to the PHE, three have continued to charge these premiums while the other three have temporarily waived or suspended these premiums. While specific premium policies vary across states that have Section 1115 approval for premium requirements, available data and evaluations from five states that have implemented these requirements show that high numbers of enrollees fail to pay premiums, face consequences for nonpayment, and experience confusion over premium policies.ĭuring the COVID-19 public health emergency (PHE), states may not disenroll those who fail to pay premiums.Eight states have CMS approval to implement Section 1115 waivers with premium requirements, with stated goals of these requirements including increasing personal responsibility and ensuring program sustainability.Recent studies bolster earlier research on premiums and cost-sharing for low-income populations, indicating that these policies lead to reduced coverage, worse access to care, and increased financial burden.Our analysis of premiums in post-Affordable Care Act (ACA) Section 1115 waivers (approved under the Obama and Trump administrations) is based on available interim and final waiver evaluations as well as annual and quarterly state data reports posted on. Our review of recent literature on premiums and cost-sharing is based on studies and reports published between 20. States generally may not use Section 1115 authority to waive other cost-sharing protections such as statutory limits on co-payment amounts. ![]() We also summarize approved Section 1115 demonstration waivers allowing eight states to charge premiums to enrollees below 150% FPL (AZ, AR, GA, IN, IA, MI, MT, and WI) and analyze available data on the impact of these premiums from five states (AR, IN, IA, MI, and MT). This brief reviews and summarizes the most recent literature on the impact of premiums and cost-sharing on low-income populations. A large body of research shows premiums serve as a barrier to obtaining and maintaining Medicaid coverage even relatively small levels of cost-sharing are associated with reduced care, including necessary services, as well as increased financial burden for families and state savings from premiums and cost-sharing in Medicaid are limited. Maximum allowable cost-sharing in Medicaid varies by type of service and income, with total family out-of-pocket costs (premiums and cost-sharing) limited to no more than 5% of family income. States may not charge premiums to Medicaid enrollees with incomes below 150% of the federal poverty level (FPL). Federal law limits the extent to which states can charge premiums and cost sharing in Medicaid because the Medicaid population is low-income. ![]()
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