By Deena Winter | Nebraska Watchdog
LINCOLN – Just like thousands of other Nebraskans, Tammy Fiechtner got a letter from her insurance company this summer saying her insurance plan would be terminated next year, but she could buy a comparable plan that complies with Obamacare mandates.
The new plan’s monthly premium would be about $15 cheaper, but her deductible would increase from $3,000 to $5,000, she’d go from no copay to 50 percent copays, and the out-of-pocket limit would more than triple from $3,000 to $12,700 for her and her husband, Kevin.
So when the new Obamacare insurance exchange opened for business Oct. 1, she jumped on Healthcare.gov to see if she could find a more affordable plan. Like millions of other Americans, she’s been stymied by website glitches, but since she’s an independent insurance agent, she’s done her own research and here’s what she’s learned: They make too little to get subsidized insurance through the exchange, and too much to get on Medicaid.
“I’m too poor for Obamacare and I’m too rich for Medicaid in the state of Nebraska,” she said.
She doesn’t qualify for Obamacare assistance because she should qualify for the newly expanded Medicaid. But Nebraska is one of 26 states that chose not to expand Medicaid — a key provision of Obamacare designed to cover low-income people but also a provision the U.S. Supreme Court ruled states don’t have to participate in.
She was diagnosed with stage 2 colon cancer in November 2011 but has been able to handle the cost of her current plan, with its maximum $3,000 out-of-pocket limit. She knows she’ll have at least $10,000 in health care costs next year, and the increased deductible and new $12,700 out-of-pocket limit are too much for her budget.
So Fiechtner can buy insurance on the open market but can’t get any federal subsidies and will be fined if she doesn’t buy some kind of insurance next year. Where does that leave them? She’s losing her current Blue Cross and Blue Shield plan and can’t afford the new options.
Although under Obamacare, the feds would pay all the costs of states’ Medicaid expansion from 2014 to 2016 and drop their share to 90 percent by 2020, Gov. Dave Heineman and state lawmakers have so far chosen not to expand Medicaid. The governor has repeatedly said it would cost too much money, taking funds from education and likely requiring a tax increase.
If Nebraska expanded Medicaid, adults who make up to 138 percent of the federal poverty level (or about $27,000 for a family of three) could get on the program.
When asked about Fiechtner’s situation, Nebraska Medicaid director Vivianne Chaumont acknowledged that a person whose income is less than 100 percent of the federal poverty level may not be eligible for either Medicaid or assistance on the exchange.
Authors of the health care law expected people earning below 138 percent of poverty to get on Medicaid and didn’t provide tax credits for the lowest income.
The Kaiser Family Foundation says nearly 5 million Americans will fall into a “coverage gap” because their home states didn’t expand Medicaid and their income is above current Medicaid eligibility thresholds but below the lower limit for federal tax credits. They estimate 32,570 poor, uninsured, nonelderly adults in Nebraska will fall into this gap.
The Kaiser Foundation said people who fall into this gap will likely be unable to afford to buy insurance on the marketplace, where they can’t get subsidies and may face out-of-pocket costs of up to $6,350 per year – much less than the Fiechtners are looking at.
The Stapleton ranchers had an adjusted gross income of $10,100 last year, and this year will probably be worse after a fire wiped out 1,200 acres of their 5,000-acre ranch and a drought caused them to buy a lot of feed for their 400 head of cattle.
Fiechtner said her family went without TV, Internet and bowling leagues for years in order to pay for their dream of having a ranch to pass on to their children. Now they’re not sure how they’ll get insurance, ironically, with the advent of Obamacare. She’s angry at the governor, too, now that she understands how this whole thing works, or doesn’t work, without an expansion of Medicaid.
“I am not poor by any means,” she said. “I have a very comfortable home, heat, health insurance, life insurance… I do OK. By no means is my cash flow easy, but now it’s going to be strapped even further.”
Omaha Sen. Jeremy Nordquist, a Democrat who has pushed state leaders to expand Medicaid, said it appears Fiechtner has fallen into the coverage gap.
“These are low-income workers who will continue to go to the ER for health care, maintaining a high level of uncompensated care cost-shifting in our system,” Nordquist said via email.
Last session, a bill that would’ve expanded Medicaid was filibustered and not voted on because supporters couldn’t round up enough votes to cut off debate. Nordquist has vowed to bring the bill to a vote in the next legislative session. In response, on Wednesday the governor challenged Nordquist to bring the bill up for a cloture vote on the first day of the session when it begins in January.
“Why are they waiting?” Heineman chided. “They could’ve asked for it in the last session… let’s find out who’s got the votes.”
Fiechtner said the Republican governor makes it sounds like expanding Medicaid will only help “lazy people who don’t have a job” when not expanding Medicaid is going to hurt farmers and ranchers like her. She is a Republican and agrees with Heineman that taxes are too high already – she pays $23,000 per year in property taxes alone – and she opposes redistribution of wealth. But she thinks Medicaid should be expanded to help people like her afford health insurance in this new landscape.
She worries what will happen if Obamacare fails after she’s been terminated from her current policy. Fiechtner recently had her annual colonoscopy, and will get results soon.
“God forbid, what if they find something?” she said.
She’s not sure yet what she’s going to do, and is hoping Obamacare will be postponed. While she’s angry and frustrated, she hasn’t lost the gritty determination of a first-generation rancher just trying to make it despite droughts, blizzards and fires.
“We’ll figure out something,” she said. “We’re very resilient.”
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