If health insurance is affordable for a family’s breadwinner but not for everyone else in the household, that’s a problem.
Minor and major illnesses are part of life. Throughout the year, even healthy family members will likely need to see a doctor at some point. For children, it could be an ear infection or a football injury. A spouse may need maternity care.
Coverage for all is vital. That’s why a recently announced fix for the Affordable Care Act’s “family problem” is overdue but welcome nonetheless. This will help ensure that a whole family has health insurance, not just the person who works outside the home.
The announcement fell Tuesday at the White House. Former President Barack Obama has joined President Joe Biden in rolling out a solution for the estimated 5.1 million Americans in the unfortunate coverage gap created by a loophole in landmark health care law.
The Affordable Care Act (ACA) was signed into law in 2010. One of its key elements: providing financial assistance to those who buy health insurance on their own, which means they don’t get it through an employer or a public program such as Medicare – the federal health insurance program that typically serves seniors.
ACA grants act as an instant rebate on the premiums consumers pay for health insurance, sometimes reducing these monthly costs by hundreds of dollars. But aid is only available to those who meet the eligibility criteria. Having access to an “affordable” plan through an employer is a disqualifier.
The problem, especially for working families, is that the law weighs too heavily on affordability, preventing some people who should be eligible for ACA financial assistance from getting it.
The criteria should have determined whether family finances can handle a more expensive employer-provided plan that covers both the employee and their dependents. Instead, the test has been whether the household budget can handle a less expensive employee-only policy.
The difference in cost between an individual and family plan can be significant. “In 2021, average premiums for employee-only coverage were $7,739, compared to $22,221 for family coverage,” according to an article in the Health Affairs journal.
If a family can’t afford an employer-sponsored plan that covers everyone, that shouldn’t mean some members are left without coverage. Instead, they should be able to tap into another option: online marketplaces such as MNsure, where self-purchasing consumers can access financial assistance from the ACA.
The family problem has prevented families from doing this for too many years. An analysis by the Kaiser Family Foundation looked at who is caught in this affordability gap. “A majority of them are children,” according to an analysis. “Among adults, women are more likely to fall into the glitch than men.”
Biden plans to resolve the family issue through the administrative branch regulator. Ideally, such a remedy would have been used long before today. But the political will was seriously lacking when Republican majorities in Congress threatened the very existence of the ACA. The cost — about $4.5 billion a year — has also hampered support.
Minnesota deserves credit for leading the way in solving the family problem. In 2021, it became the first state to act when lawmakers passed a partial fix to begin in 2023. The measure would help many struggling families, but not all. Still, it is an important step forward, with innovative leadership on this issue by Rep. Jennifer Schultz, DFL-Duluth.
Lynn Blewett, a policy expert from the University of Minnesota School of Public Health, praised the fixes made by the state and federal government. The ACA is not the first law to need improvement and it will not be the last. “Now is the time to mend the lost ends, and this is clearly one of them,” she said.