The COVID-19 pandemic has exposed the many weaknesses of a health care system that ties coverage tightly to employment. Two recent reports by Families USA underscore the catastrophic result: an estimated 124,000 New Jerseyans lost access to their health insurancedue to loss of employment in the first months of 2020 and were not able to enroll in coverage under Medicaid, a spouse’s coverage, or the individual insurance market. This means that a total of approximately 701,000, or 13 percent, of all non-elderly adults in the state were uninsured as of May 2020.[i] Alarmingly, this loss of insurance could lead to additional job losses: as revenue for health care decreases, another 86,000 jobs could be lost in New Jersey’s health care industry alone.
These striking numbers, while historic, could have been much worse if not for state and federal policies that have expanded access to health care. If New Jersey had not expanded Medicaid, as allowed by the Affordable Care Act (ACA), many more individuals would currently be uninsured. By expanding eligibility to previously excluded individuals — including childless adults with income below 138 percent of the federal poverty level ($1,468 per month for a single adult in 2020) — the Garden State has a lower share of adults who are uninsured during the crisis than states that have not expanded Medicaid.[ii] The Families USA reports estimate that uninsurance rates for non-elderly adults in non-expansion states have reached levels as high as 29 percent (Texas), which could result in 362,000 additional job losses in the health care sector.[iii] With Census Bureau data showing that, nationwide, communities of color and low-wage workers have been most likely to lose insurance during the pandemic, Medicaid eligibility for these vulnerable populations has proven crucial to better addressing the fallout of the crisis.
During New Jersey’s pandemic lockdown, increases in NJ FamilyCare enrollment — New Jersey’s Medicaid and Children’s Health Insurance Program (CHIP) — show that the program serves as critical relief for many experiencing a loss of income. After an overall decline in enrollment in previous months, the COVID-19 pandemic led to a quick and significant surge in Medicaid enrollment numbers as disenrollment was frozen and hundreds of thousands of residents faced unemployment.[iv] From February to July 2020, total enrollment in NJ FamilyCare increased by 118,622 individuals, a jump of 7 percent. Enrollment in all non-Aged, Blind, and Disabled eligibility groups increased during the crisis as well. Most notably, enrollment for adult groups that became newly eligible under the Medicaid expansion rose significantly during the crisis, demonstrating that this safety net has successfully protected thousands of New Jerseyans that otherwise would have been uninsured after losing insurance through their employers.
How do we move forward?
Pandemics necessitate strong governmental responses. Leaders need to both support the health care system through crisis conditions and protect residents by slowing the spread of the outbreak. Viruses do not discriminate in whom they infect, but they do thrive on discriminatory structures within a country, feeding off of the disparities and shortcomings in our institutions and furthering the inequities present. Strengthening affordable health care options outside of employment, providing safe working conditions, improving access to basic needs like healthy foods, and increasing resources to deal with emergencies that low- and moderate-income families face should be prioritized.
By supporting the ACA, building more options for affordable coverage, avoiding cuts to critical services for vulnerable populations, and establishing guarantees of job retention in the midst of unsafe conditions, state lawmakers can demonstrate their commitment to a more equitable New Jersey. This is not the first crisis to challenge our existing social and economic systems, nor will it be the last. It is time for Garden State leaders to recognize the lessons of COVID-19 and to make sure that when another outbreak inevitably arrives, we are ready.
ABD = Aged, Blind, and Disabled.
M-CHIP = Children under an extended income eligibility group in Medicaid that is funded by CHIP funds.
ABP = Alternative Benefit Plan. New Jersey’s adoption of Medicaid expansion introduced eligibility for all non-Medicare eligible individuals under age 65 (children, pregnant women, parents and adults without dependent children) with incomes up to 138 percent of federal poverty level (FPL) based on modified adjusted gross income.
[i] It is important to note here that some of the individuals who were furloughed or who elected to move into COBRA coverage after losing employment may be delayed in their self-reported loss of coverage as they maintain benefits for a few to several months after employment. However, for low-income households, coverage under such programs as COBRA is often unaffordable.
[ii] While the ACA officially introduced eligibility for households below 133 percent of the federal poverty level (FPL), it was doing so for “modified adjusted gross income” (MAGI). In another part of the act, one modification introduced was a further five-point deduction from the FPL, effectively making the eligibility level 138 percent. More information on this distinction can be found here: https://www.shadac.org/news/aca-note-when-133-equals-138-fpl-calculations-affordable-care-act
[iii] This calculation does not cover the recent spikes in COVID-19 cases in many of the non-expansion states.
[iv] With the Families First Coronavirus Response Act, a Federal Medical Assistance Percentage (FMAP) bump was provided for states, given that they met particular requirements. One of these Maintenance of Effort (MOE) provisions required that Medicaid enrollees who might have otherwise lost eligibility due to “issues such as non-response to redetermination requests or changes in income” remain enrolled during the course of the crisis. Maintaining these enrollees while also taking in new enrollees accounts for a significant amount of the growth, as noted in the above linked New Jersey Department of Human Services monthly enrollment report. This helps to protect many who may have struggled to attend to redetermination requests or faced uncertain income levels during this time, in addition to those who have recently lost employment.