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Democrats gave Americans a big boost buying health insurance. It didn’t come cheap

Noam N. Levey, Kaiser Health News on

Published in Health & Fitness

But the large new government commitment underscores the disparity between the high price of private health insurance and lower-cost government plans such as Medicare and Medicaid.

Acutely aware of this disparity, the crafters of the ACA laid out a second path to provide health insurance for uninsured Americans beside the marketplaces: Medicaid.

The half-century-old government safety net insures about 13 million low-income, working-age adults who gained eligibility for the program through the health law and make too little to qualify for subsidized commercial insurance.

Medicaid coverage is still costly: about $7,000 per person every year, federal data indicates.

But that’s about 18% less than what the government will pay to cover people through commercial health plans.

“We knew it would be less expensive than subsidizing people to go to private plans,” said former Rep. Henry Waxman, a California Democrat who as chairman of the House Energy and Commerce Committee helped write the Affordable Care Act and has long championed Medicaid.

 

For patients, Medicaid offered another advantage. Unlike most commercial health insurance, which requires enrollees to pay large deductibles before their coverage kicks in, Medicaid sharply limits how much people must pay for a doctor’s visit or a trip to the hospital.

That can have a huge impact on a patient’s finances.

Take, for example, a 50-year-old woman living outside Phoenix with a part-time job paying $1,000 a month. With an income that low, the woman could enroll in Arizona’s Medicaid program.

If, one day, she slipped on her steps and broke an arm, her medical bills would likely be fully covered, leaving her with no out-of-pocket expenses.

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