NJPP Testimony: New Jersey Should Seize ACA Opportunity & Tap Federal Funds for Outreach
STATEMENT BY RAYMOND CASTRO, SENIOR POLICY ANALYST, NEW JERSEY POLICY PERSPECTIVE, ON OUTREACH, BEFORE ASSEMBLY HEALTH COMMITTEE, TRENTON, NEW JERSEY, FEBRUARY 6, 2014
Thank you for the opportunity to testify on the need for effective outreach in connection with the Affordable Care Act. The ACA provides New Jersey with an unprecedented opportunity to provide health coverage to most of the uninsured. That is critical in a state which has over 1 million residents who are uninsured, the tenth highest in the country. Furthermore, because the cost of health insurance has risen so quickly, the number of uninsured is increasing faster here than in most states.
However I would like to emphasize that the ACA is only an opportunity and without adequate outreach the real promise of this legislation will not be achieved.
New Jersey faces many challenges in outreach. New Jerseyans often have barriers which must be overcome before they will enroll in the Health Insurance Marketplace. New Jersey has the fifth highest immigrant population in the country, so language is a huge barrier. Seventeen percent of all of the uninsured who are eligible for coverage in the Marketplace are in households where no adults speak English – that is an incredible statistic! Almost half are poor and may not have their own computer to apply online. About two-thirds of the uninsured work, often at more than one job, and therefore it is difficult for them to find the time to apply for assistance.
New Jersey also has among the highest housing costs in the nation, thus it will be difficult for many working-class families to afford the premiums and cost sharing even at a reduced rate. Without intensive outreach, the New Jerseyans who need health coverage the most may never obtain it.
As you know, both the marketplace and Medicaid got off to a very slow start in the first few months. The marketplace website was almost completely dysfunctional. The state’s Medicaid website worked, but many people were not aware of its existence. Many people seem to think that since the federal marketplace was not working, the state’s website was not working as well. Of course the negative partisan attacks on Affordable Care Act did not help and created further confusion that discouraged enrollment. The most recent enrollment numbers are positive but we still have a long way to go.
To make matters worse, in addition to this higher need in New Jersey, the state has fewer resources than many other states for outreach. As is well-known, the main reason for this is the governor’s decision not to establish a state exchange, defaulting to a federal exchange instead. Not only did this mean that New Jersey would not receive between $100 and $200 million to establish a state exchange, it would also not receive full funding for outreach. For example Maryland received $16 million for outreach compared to only about $8 million in New Jersey. In addition New Jersey achieved $227 million in state savings this year as a result of the Medicaid expansion but all these savings were used to balance the state budget and no funds were allocated for outreach. These savings will double in next year’s state budget – yet we have heard of no plans to reinvest any of them in Medicaid.
Fortunately there is an obvious solution to this funding problem. About two years ago the federal government allocated $7.6 million to the state to establish its own exchange. After the governor rejected the state exchange, the federal government said the money could be used for other purposes such as outreach and marketing. So far the state has not submitted a plan that is approvable. We are very concerned about this because if the governor does not claim the funds by February 20th they will be returned to the federal government. Given the tremendous need in New Jersey, this must not happen.
Yesterday we released a report on the devastating impact of not using these funds for outreach. We estimated that up to 95,000 uninsured New Jerseyans would not hear about this opportunity in the marketplace to obtain the health coverage they need. We were also able to measure the impact on the wide range of groups in New Jersey who are uninsured. About 67,000 who could benefit from additional outreach live in a family with a full-time worker, for example. In other words, these families are playing by all the rules but they can’t get by in high cost of living New Jersey.
Thirty six thousand young and uninsured residents are at risk of being left behind if the state doesn’t use the money. This could create a problem in the Marketplace and make it less financially solvent since young adults are needed to offset the higher cost of more at-risk adults like the aged.
About 14,000 who will be affected have a serious mental illness. If they do not receive health coverage to treat their illness that means higher state costs in our state institutions and for community services. Another 44,000 are simply poor and need the help the most. The vast majority who will be affected are people of color although the largest group is non-Hispanic white.
We also estimated the number of people who would not obtain health coverage by occupation, which is wide ranging. The largest categories are those working in restaurants, construction, landscaping services, grocery stores and department stores. But they also work in many other occupations. These are people we interact with every day in hair salons, gas stations, home health agencies and schools. In many cases they are our friends, neighbors and relatives.
We were also able to identify the uninsured who would not obtain coverage by county. As might be expected, the largest numbers are in the more urban counties such as Hudson and Essex. But there are also thousands in our most affluent counties like Morris and Somerset because as you all know, the downturn in the economy has affected those areas too.
Lastly, we need more accountability and transparency in the state’s and federal government’s efforts to enroll the uninsured. We will be shortly announcing monthly enrollment goals which we are working on with many stakeholders. The purpose is to show what the enrollment would be with enhanced outreach and average outreach and then compare those enrollments with the actual enrollment. Another goal is to refine the process for estimating the groups that are underserved and need more attention.
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