BCBSA

Addressing the Uninsured Through Tailored Options and More Affordable Coverage

Issue:  The number of people in the United States without health insurance continues to increase, and mounting healthcare costs are making coverage less affordable for many Americans.

Position:  Reducing the ranks of the uninsured and keeping quality healthcare affordable should be a top federal priority.  BCBSA supports a two-pronged approach: (1) Tailored options to expand coverage and (2) Initiatives to address rising healthcare costs.

Tailored Options for Covering the Uninsured

The Blue Cross and Blue Shield Association (BCBSA) proposes a range of options to address the varied circumstances of the uninsured.  Though diverse, the uninsured fall into three overarching categories:

1.  Lower-Income Individuals and Families:  Many of the uninsured have difficulty affording coverage because they are ineligible for public assistance but earn less than $50,000 annually.  Options targeting these uninsured include:

  • Helping Low-Wage Workers in Small Firms:  Small firms with low-wage workers would receive a refundable tax credit to sponsor insurance.  Low-wage workers in small firms are less likely to have employer coverage than other workers.  The credit would be limited to firms with low-wage workers to avoid subsidizing those who may be able to afford coverage on their own. 
  • Helping Those Struggling with Healthcare Costs:  Families whose premiums exceed 5 percent of their income would receive a refundable tax credit for the premium amount exceeding the income threshold.  With this credit, no one would have to use a large portion of household income for premiums, even if they are part-time, full-time, temporary, self-employed or work in a large or small firm.
  • Assisting Those Between Jobs:  This initiative focuses on those most vulnerable to being uninsured — the unemployed.  It would extend the federal tax credit currently available to those who have lost their jobs because of trade policy to all of the unemployed.
  • Expanding the Public Safety Net:  The State Children's Health Insurance Program (SCHIP) would be extended to everyone at or below the federal poverty level who is not eligible for Medicaid.  Federal funds would cover the full cost of these enrollees if states purchase employer coverage for them — by paying the employee's share of the premium — whenever possible.
  • Promoting Collaborative Private Initiatives:  Grants would encourage innovative partnerships among insurers, providers, and others to develop affordable health plans for the uninsured by using new benefit design options, provider discounts, or other cost control methods.
  • Encouraging State-Tailored Initiatives:  Federal grants would enable states to develop initiatives tailored to their unique uninsured populations (e.g., migrant workers).
  • Helping States Assure Access to Coverage for Individuals:  Federal funding for state high- risk pools — which offer subsidized coverage to individuals with serious health conditions — would be permanent and would cover at least 50 percent of pools' annual operating losses. 

2.  Individuals Eligible for Public Programs:  Many of the Census-identified uninsured are reachable through Medicaid or SCHIP.  Consumer unfamiliarity with the programs, enrollment red tape, language barriers, and a perceived stigma all discourage enrollment.  BCBSA recommends:

  • Helping States Enroll Low-Income People in Medicaid and SCHIP:  The federal government would fund enhanced state outreach efforts and facilitate the sharing of enrollment best practices.  States would also take measures to streamline the enrollment process.
  • Empowering States to Enroll Medicaid/SCHIP Beneficiaries in Employer Plans:  The federal government would make it easier for states to pay the employee premium for Medicaid- or SCHIP-eligible children and their low-income, working parents who are not otherwise eligible for public assistance.  The federal government would pay the full cost of enrolling these parents.  Enrolling families in private plans could address the "stigma" obstacle to seeking public assistance and offer broader access to providers.  States would leverage their funds by paying only the employee share of the premium instead of the full cost of the public program.

3.  Those earning $50,000 or more:  Many of these individuals may be able to afford insurance but may not believe they need it because they are young or healthy.  They may be unaware of coverage options for individuals and its tax deductibility (for the self-employed) and may overestimate the cost of coverage. BCBSA recommends:

  • Educating Americans about the Importance of Being Insured:  The public and private sectors should partner on a broad-based educational campaign on the value of insurance, the risks of being uninsured, and the options available in the market.  This initiative would tailor its messages to key uninsured populations, such as Hispanics, who are disproportionately uninsured across all income levels, and young adults, who are nearly twice as likely to be uninsured as older people.
  • Other initiatives described above would also help the higher-income uninsured.  For example, the credit for the unemployed would also help higher-income individuals who lose their jobs.

Improving the Affordability of Coverage

Blue Cross and Blue Shield Plans support a variety of initiatives to make coverage more affordable:

  • Supporting government policies that facilitate affordable coverage — such as reform of medical malpractice, greater access to generic drugs, and adoption of health information technology;
  • Promoting evidence-based medicine to ensure healthcare dollars pay for treatments and technologies that help — not hurt — patients;
  • Promoting healthy lifestyles (e.g., exercise programs) and decision-support tools that help consumers control their chronic illness and healthcare costs; and
  • Partnering with providers to improve quality and efficiency while combating fraud.