January 15, 2013

Who’s In, Who’s Out, of Coverage ‘Crater’

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Without Medicaid expansion in Oklahoma, roughly 200,000 people, mostly adults, will remain ineligible for the program. And anywhere from 130,000 to 170,000 of them will be stuck in a coverage crater next year, earning too much to get Medicaid but not enough to qualify to buy subsidized coverage on a federal health exchange, an online insurance market. Here’s an example of what a low-income Oklahoma family with two parents and two children will face, based on figures from 2012. The children are already covered by Medicaid.

  • If the parents earn $6,996 or less: They’re eligible for Medicaid.
  • If the parents earn from more than $6,996 to $23,050 (100 percent of the federal poverty level): The parents are stuck in a “crater,” earning too much to get Medicaid and too little to qualify for buying on the federal health exchange using tax credits that cover most of the cost of premiums.
  • If the parents earn from more than $23,050 to $92,200 (400 percent of the federal poverty level): The parents are not eligible for Medicaid. However, they can use immediate tax credits to purchase subsidized insurance on the federal exchange. Depending on their income, their cost of premiums will be capped at anywhere from 2 percent to 9.5 percent of their income. Those earning up to 250% of the poverty level will also get subsidies for other costs, such as deductibles, co-payments and coinsurance.

Sources: Oklahoma Health Care Authority, Urban Institute.