2021 and Beyond: AMA's Plan to Cover the Uninsured
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2021 and Beyond: AMA’s Plan to Cover the Uninsured
As millions of Americans have gained coverage had Medicaid coverage, and 7 percent had non-
resulting from the Affordable Care Act (ACA), group coverage. In 2019, 28.9 million nonelderly
progress has been made on a long-standing individuals (10.9 percent) were uninsured, an
policy priority of the American Medical increase from the 27.9 million (10.4 percent) who
Association (AMA) – expanding access to and were uninsured in 2018. While the coverage
choice of affordable, quality health insurance impacts of the COVID-19 pandemic have not
coverage. Affordable coverage options been fully realized, the economic disruption
available due to the ACA – subsidized ACA resulting from the pandemic has caused many
marketplace coverage and the Medicaid individuals to lose their employer-sponsored
expansion – are more critical than ever, serving health coverage due to job loss, causing them to
as a needed safety net for those who have lost seek other coverage options or become
their employer-sponsored health insurance uninsured.
coverage due to job losses resulting from the
COVID-19 pandemic. Prior to the COVID-19 pandemic, approximately
half of the nonelderly uninsured had family
The AMA believes that now is the time to invest incomes below 200 percent of the federal poverty
not only in fixing the law, but also in enhancing level (FPL). In 2021, 200 percent FPL is $25,760
it. Improving the ACA appropriately targets for an individual and $53,000 for a family of four.
providing coverage to the uninsured population, Many of the nonelderly uninsured are in working
rather than upending the health insurance families, due, in part, to the fact that health
coverage of most Americans. Modifications to insurance is not often offered with jobs that low-
the law could also improve the affordability of income individuals have.
coverage for those who cite costs as a barrier
to accessing the care they need. A significant proportion of the nonelderly
uninsured are eligible for ACA financial
The AMA plan to cover the uninsured and assistance, either in the form of premium tax
improve affordability focuses on four main credits or Medicaid/CHIP. Further, many
targets: individuals who have lost their employer-
sponsored coverage due to job losses resulting
1. People eligible for ACA’s premium tax from the COVID-19 pandemic can qualify for ACA
credits who remain uninsured financial assistance. Therefore, it remains
imperative to craft public policy solutions to cover
2. People eligible for Medicaid or the the uninsured based on eligibility for premium tax
Children’s Health Insurance Program credits or Medicaid/CHIP.
(CHIP) who remain uninsured
Problems with Affordability
3. People who remain uninsured who are
ineligible for ACA’s premium tax credits
Cost is frequently cited as a reason for being
uninsured - 74% of nonelderly adults in 2019 said
4. People with low incomes who remain
they were uninsured because coverage was not
uninsured and are ineligible for Medicaid
affordable. One in three insured adults reported it
was difficult to afford to pay their deductible. In
Who Are the Uninsured? addition, approximately one in four insured adults
reported difficulties in paying the cost of health
Prior to the COVID-19 pandemic, nearly 60 insurance premiums monthly, as well as the cost
percent of nonelderly Americans had employer- sharing associated with physician visits and
sponsored health insurance coverage, 21 percent prescription drugs. Overall, approximately half of
© 2021 American Medical Association. All rights reserved.US adults reported they or a family member Therefore, the AMA believes that proposals to
delayed or skipped needed health care or dental cover the uninsured need to include provisions to
care in the past year due to cost. improve health insurance affordability, including
for those who have difficulties affording their
Premium costs can serve as a factor contributing deductibles and other cost-sharing
to individuals being uninsured, as well as in their responsibilities, and individuals and families
health plan selection, potentially driving whose employer-sponsored coverage is
individuals to select plans with lower premiums, unaffordable.
but higher deductibles and cost-sharing
responsibilities. For the 2020 open enrollment AMA Plan: Cover Uninsured Eligible
period for the 38 states with federally facilitated or for ACA’s Premium Tax Credits
partnership exchanges, the average premium
was $595 per month before any application of Nearly 15 million of the nonelderly uninsured are
premium tax credits. However, premiums were eligible for ACA’s premium tax credits. Reasons
reduced significantly for those eligible for for this population remaining uninsured include
premium tax credits, which constitute most ACA premiums and cost-sharing responsibilities for
marketplace enrollees – the average monthly available plans being viewed as unaffordable, as
premium for these individuals was $89. In the well as individuals simply not being aware of the
employer market, in 2020, the average annual financial assistance available to them under the
employee contribution for self-only coverage was ACA.
estimated to be $1,243, while the average annual
employee contribution for family coverage was The AMA supports adequate funding for and
estimated to be $5,588. expansion of outreach efforts to increase
public awareness of ACA’s premium tax
Once covered, individuals can face high credits. In recent years, there have been
deductibles and other cost-sharing significant federal funding cuts to ACA-related
responsibilities. In 2020, assessing the states advertising, limiting educational activities targeted
with federally facilitated or partnership at new and returning marketplace enrollees for
exchanges, the average deductible in plans with the open enrollment period. In addition, federal
combined medical and prescription drug spending on the ACA’s navigator program, which
deductibles was $6,506 for bronze plans and provides outreach, education, and enrollment
$4,544 for silver plans. Cost-sharing reductions assistance to consumers eligible for marketplace
bring down the deductibles of silver plans for coverage as well as for Medicaid, has been cut
individuals who are eligible. As a result, in 2020, drastically. The AMA believes there is a clear
the average deductible for a silver plan was opportunity to improve awareness about premium
reduced to $209 for individuals with incomes tax credits and other financial assistance that
between 100 and 150 percent FPL, $762 for may be available to enrollees, as well as clear up
those with incomes between 150 and 200 percent confusion about eligibility rules. Adequately
FPL, and $3,268 for those with incomes between funding and expanding outreach efforts will not
200 and 250 percent FPL. only increase the number of people who are
insured, but also will help to balance the
For the 83 percent of covered employees that individual market risk pool by increasing overall
had a general annual deductible in 2020, the marketplace enrollment.
average annual deductible for employee-only
coverage was $1,644. Aggregate annual The AMA supports permanently increasing
deductibles for employer-sponsored family the generosity of premium tax credits to
coverage were higher, ranging from $2,716 for improve premium affordability and incentivize
preferred provider organization (PPO) plans, to tax credit eligible individuals to get covered.
$4,552 for high-deductible plans with a tax- Generally, individuals and families with incomes
preferred savings option. above 100 percent FPL (133 percent in Medicaid
expansion states) are eligible for refundable andadvanceable premium tax credits to purchase for exchange coverage and enroll in a silver plan
coverage on health insurance exchanges. – regardless of income – are also eligible for
However, individuals receiving at least one week substantial cost-sharing reductions. Looking
of unemployment compensation in 2021 who ahead, extending eligibility for cost-sharing
qualify for exchange coverage – regardless of reductions beyond 250 percent FPL, and
income – are eligible for premium tax credits at a increasing the size of cost-sharing reductions, will
level that would allow them to enroll in a zero- lessen the cost-sharing burdens many individuals
premium silver plan. face, which impact their ability to access and
afford the care they need.
The size of premium tax credits is based on
household income relative to the cost of The AMA supports states and/or the federal
premiums for the benchmark plan, which is the government pursuing auto-enrollment for
second-lowest-cost silver plan offered on the those individuals who qualify for zero-
exchange. The premium tax credit thereby caps premium marketplace coverage. Eligible
the percentage of income that individuals pay for individuals and families with incomes between
their premiums. Recently enacted COVID-19 100 and 150 percent FPL (133 percent and 150
relief legislation temporarily – for two years – percent FPL in Medicaid expansion states) now
lowered the cap on the percentage of income qualify for zero-premium silver plans, effective
individuals are required to pay for premiums of until the end of 2022, and individuals receiving
the benchmark plan. The AMA supports unemployment compensation who qualify for
measures to permanently increase the generosity exchange coverage are eligible for a zero-
of premium tax credits, by tying premium tax premium silver plan in 2021. Others remain
credit size to gold-level instead of silver-level plan eligible for zero-premium bronze or silver plans,
premiums, and/or lowering the cap on the after the application of any subsidies. Therefore,
percentage of income individuals are required to the targeted use of auto-enrollment for the
pay for premiums of the benchmark plan. population eligible for zero-premium marketplace
coverage has the potential to achieve significant
The AMA supports providing enhanced coverage gains. In addition, for those who lose
premium tax credits to young adults. In order their employer-sponsored health insurance
to improve insurance take-up rates among young coverage resulting from the COVID-19 pandemic,
adults and help balance the individual health state unemployment insurance systems could be
insurance market risk pool, young adults ages 19 leveraged to facilitate enrollment in no- or low-
to 30 who are eligible for advance premium tax cost health insurance for which the newly
credits could be provided with “enhanced” unemployed are eligible.
premium tax credits—such as an additional $50
per month—while maintaining the current The AMA supports permanently eliminating
premium tax credit structure which is inversely the subsidy “cliff,” thereby expanding
related to income, as well as the current 3:1 age eligibility for premium tax credits beyond 400
rating ratio. Smaller amounts could be provided to percent FPL past 2022. COVID-19 relief
individuals between ages 30–35. legislation enacted into law in March 2021
temporarily eliminated the subsidy cliff for two
The AMA supports expanding the eligibility years. More than three million of the nonelderly
for and increasing the size of cost-sharing uninsured have incomes that exceed 400 percent
reductions. Generally, individuals and families FPL, who would otherwise be affected by the
with incomes between 100 and 250 percent FPL subsidy cliff. Premiums of the second-lowest-cost
(between 133 and 250 percent FPL in Medicaid silver plan for individuals with incomes at and
expansion states) also qualify for cost-sharing above 400 percent FPL ($51,040 for an individual
subsidies if they select a silver plan, which leads and $104,800 for a family of four based on 2020
to lower deductibles, out-of-pocket maximums, federal poverty guidelines) are now capped at 8.5
copayments and other cost-sharing amounts. Of percent of their income. Without a permanent
note, individuals receiving at least one week of elimination of the subsidy cliff, individuals and
unemployment compensation in 2021 who qualify families with higher incomes will again beineligible for any financial assistance in the form AMA Plan: Make Coverage More
of premium tax credits, even if the income Affordable for People Not Eligible for
differential above 400 percent FPL is minimal.
ACA’s Premium Tax Credits
AMA Plan: Cover Uninsured Eligible
While the COVID-19 relief bill enacted into law in
for Medicaid or CHIP March of 2021 temporarily extended premium tax
credit eligibility to those with higher incomes,
Millions of the nonelderly uninsured remain some individuals with an offer of “affordable”
eligible for Medicaid or CHIP. Reasons for this employer-sponsored health insurance coverage
population remaining uninsured include lack of remain ineligible for assistance provided by
awareness of eligibility or assistance in ACA’s premium tax credits due to how
enrollment. The imposition of Medicaid work “affordability” was defined in the ACA and
requirements also has caused individuals eligible subsequent regulations. Without needed financial
for Medicaid to be uninsured. assistance, this population can continue to face
unaffordable premiums and remain uninsured.
The AMA supports states and/or the federal
government pursuing auto-enrollment for The AMA supports lowering the threshold that
those individuals who qualify for determines whether an employee's premium
Medicaid/CHIP. Auto-enrolling individuals who contribution is “affordable,” allowing more
qualify for Medicaid or CHIP coverage at no cost employees to become eligible for premium tax
to them would lead to significant coverage gains credits to purchase marketplace coverage.
among the nation’s lowest-income adults and Individuals eligible for premium and cost-sharing
children. subsidies to purchase coverage on health
insurance exchanges include US citizens, legal
The AMA supports increasing and improving immigrants, and employees who are offered an
Medicaid/CHIP outreach and enrollment. employer plan that does not have an actuarial
Successful outreach and enrollment strategies value of at least 60 percent or if the employee
that states have deployed to achieve and share of the premium exceeds 9.83 percent of
maintain coverage gains include developing and income in 2021. As a result, some employees,
implementing broad marketing and outreach especially those with lower incomes, are caught
campaigns; providing, training and supporting in- in a situation where the employer-sponsored
person assisters; and developing and coverage available to them is not affordable, yet
implementing streamlined eligibility and they are not eligible for premium tax credits to
enrollment systems that can coordinate with other purchase marketplace coverage. This affordability
programs. misalignment prevents a segment of workers
from accessing coverage that would in many
The AMA opposes Medicaid work instances be more affordable on health insurance
requirements. The AMA believes that Medicaid exchanges.
work requirements will negatively affect access to
care and lead to significant negative The AMA supports fixing the ACA’s “family
consequences for individuals’ health and well- glitch.” In determining eligibility for premium tax
being. The AMA is especially concerned about credits, coverage for family members of an
interrupting the continuity of care for patients who employee is considered to be affordable as long
are subject to the requirements, and with the as employee-only coverage is affordable. The
coverage losses experienced and projected in employee-only definition of affordable coverage
states that have moved forward with Medicaid pertaining to employer-sponsored coverage,
work requirements. Studies show that most commonly referred to as ACA’s “family glitch,”
individuals who would lose their coverage under does not take into consideration the cost of
Medicaid work requirements will do so due to family-based coverage, which commonly is much
increased administrative burdens, versus not more expensive than employee-only coverage.
meeting the actual work requirements. The average employee contribution for self-onlycoverage was estimated to be $1,243 in 2020, AMA Plan: Expand Medicaid to Cover
while the average contribution for family coverage More People
was estimated to be $5,588. The “family glitch”
leaves many workers and their families ineligible
Before the COVID-19 pandemic, in 2019, 2.2
to receive premium and cost-sharing subsidies to
million of the nonelderly uninsured found
purchase coverage on health insurance
themselves in the coverage gap – not eligible for
exchanges, even though in reality they would
Medicaid, and not eligible for tax credits because
likely have to pay well over 9.83 percent of their
they reside in states that did not expand
income for family coverage. There is also the
Medicaid. Without access to Medicaid, these
potential for workers and families affected by the
individuals do not have a pathway to affordable
glitch to remain uninsured, especially considering
coverage.
that low-income families are disproportionately
affected.
The AMA encourages all states to expand
Medicaid eligibility to 133 percent FPL. To
The AMA supports the establishment of a
date, 38 states and DC have adopted the
permanent federal reinsurance program, and
Medicaid expansion, with 12 states not adopting
the use of Section 1332 waivers for state
the expansion. States that have not yet expanded
reinsurance programs. Reinsurance provides
Medicaid are now eligible for a five-percentage-
payments to plans that enroll higher-cost
point increase in their traditional Federal Medical
individuals whose costs exceed a certain
Assistance Percentage Rate (FMAP) for two
threshold, also known as an attachment point, up
years if they implement the expansion. This newly
to a defined reinsurance cap. Reinsurance plays
adopted incentive would provide additional funds
a role in stabilizing premiums by reducing the
to states that newly expand Medicaid, applicable
incentive for insurers to charge higher premiums
to a large share of their Medicaid population and
across the board in anticipation of higher-risk
spending. In the near term, the new five-
people enrolling in coverage.
percentage-point increase would be in addition to
the current 6.2-percentage-point increase in the
The temporary reinsurance program in place
match rate provided under the Families First
during the early years of Affordable Care Act
Coronavirus Response Act (FFCRA) pursuant to
(ACA) implementation – 2014-16 – helped
the COVID-19 public health emergency.
stabilize premiums in the individual health
Importantly, states that newly expand would also
insurance marketplace. For example, in 2014,
receive a 90 percent federal match for the
insurers received reinsurance payments once an
expansion population. The AMA believes that
enrollee’s costs exceeded $45,000 (attachment
states that newly expand Medicaid should be
point), covering 80 percent of enrollee costs up to
made eligible for three years of full federal
$250,000 (reinsurance cap). The $10 billion
funding.
reinsurance fund for 2014, the result of the $63
per enrollee per year contributions, was
The AMA advocates that any public option to
estimated to reduce premiums by 10 to 14
expand health insurance coverage must be
percent.
made available to uninsured individuals who
fall into the “coverage gap” at no or nominal
Section 1332 waivers have also been approved
cost. The AMA believes that the primary goals of
to provide funding for state reinsurance
establishing a public option are to maximize
programs. As a result, premiums are lower in
patient choice of health plan and maximize health
2021 in the individual market in these states than
plan marketplace competition. And, for those
what they otherwise would have been. For
individuals who fall into the “coverage gap” in
example, the Oregon Reinsurance Program
states that do not expand Medicaid, a public
reduced individual market rates by 6 percent,
option has the potential to finally provide them
while Colorado’s reinsurance program contributed
with an affordable coverage option.
to a 20.8 percent average decrease in premiums
for 2021.That being said, physician payments under any lifetime limits, and out-of-pocket expenses,
public option must be established through except in the limited circumstance of short-
meaningful negotiations and contracts. Physician term limited duration insurance offered for no
payments under any public option must be higher more than three months. Unlike ACA
than prevailing Medicare rates and at rates marketplace plans, short-term limited duration
sufficient to sustain the costs of medical practice. insurance (STLDI) plans do not have to comply
Public option proposals should not require with the market reforms and consumer
provider participation and/or tie physician protections of the ACA. As such, STLDI plans can
participation in Medicare, Medicaid and/or any deny coverage or charge higher premiums based
commercial product to participation in the public on health status; exclude coverage for pre-
option. A public option must be financially self- existing conditions; impose annual or lifetime
sustaining, have uniform solvency requirements, limits; have higher out-of-pocket limits than the
and not receive advantageous government ACA maximums; not cover essential health
subsidies in comparison to those provided to benefit categories; rescind coverage; and not
other health plans. comply with medical loss ratio requirements.
Limiting STLDI coverage would help reinstate the
AMA Plan: Reverse Actions That original purpose of STLDI – to serve as a very
Negatively Impacted Health temporary bridge between plans offering
meaningful coverage, thereby preventing
Insurance Gains
destabilization of the ACA marketplaces and
ensuring individuals are in health plans that cover
The AMA is highly concerned that recent pre-existing conditions.
legislative and regulatory actions have negatively
impacted the health insurance achievements of
the ACA. Steps need to be taken to reverse these
AMA’s Commitment to Covering the
actions to ensure that coverage gains under the Uninsured in 2021 and Beyond
ACA can be maximized, and individuals are
enrolled in insurance coverage that guarantees The AMA has long advocated for health
coverage of pre-existing conditions. insurance coverage for all Americans, as well as
pluralism, freedom of choice, freedom of practice,
The AMA supports the adoption of and universal access for patients. The AMA
mechanisms to maximize coverage gains remains committed to improving health
under the ACA, including individual mandates insurance coverage and health care access so
and/or auto-enrollment in health insurance that patients receive timely, high quality care,
coverage. To mitigate any adverse impacts of preventive services, medications and other
the zeroing out of the federal individual mandate necessary treatments. In 2021 and beyond, steps
penalty due to enactment of tax reform must be taken to cover the uninsured and
legislation, the AMA supports reinstituting a improve affordability, so our patients are able to
federal individual mandate penalty, as well as secure affordable and meaningful coverage, and
states enacting their own individual mandates. access the care that they need.
The AMA also believes that auto-enrolling
individuals who qualify for zero-premium
marketplace coverage or Medicaid/CHIP in health
insurance coverage has the potential to improve
the coverage reach of the ACA.
The AMA opposes the sale of health
insurance plans in the individual and small
group markets that do not guarantee: a) pre-
existing condition protections; and b)
coverage of essential health benefits and their
associated protections against annual andYou can also read
