SOURCE: AP/Jay LaPrete

Demonstrators gather outside the Ohio Statehouse during a rally urging state lawmakers to extend Medicaid coverage under the Affordable Care Act, Thursday, April 11, 2013, in Columbus, Ohio.

Endnotes and citations are available in the PDF version of this issue brief.

Since being signed into law in 2010, the Affordable Care Act has already expanded access to high-quality, affordable health coverage for the millions of young adults who can now stay on their parent’s health insurance plans. And beginning in 2014, even more young adults will gain health care coverage through the law’s health insurance exchanges—private marketplaces where individuals can shop for health insurance—and the expansion of Medicaid.

Critics of the law ignore these facts and instead argue that the Affordable Care Act will increase health insurance premiums for young adults, especially in the nongroup, or individual, market. But our conservative estimates show that among all young adults, only about 3 percent of them might actually see a premium increase in the nongroup market—that is just 0.5 percent of all Americans.

This group consists of healthy young adults who have nongroup health coverage and whose incomes are too high to qualify for federal assistance that will offset any increase in premiums. But even these individuals will benefit from the law because with increased premiums come far greater benefits and security. Under the Affordable Care Act, health care plans will include benefits such as prescription drugs, maternity care, and mental-health care, which most nongroup plans exclude today. And this improved coverage will remain in place even as people age or become sick or injured. In other words, comparing the price of coverage before and after health care reform is just as unreasonable as comparing the price of Fred Flintstone’s self-powered Stone Age automobile to a modern-day hybrid vehicle—the former only functions as long as you are healthy and capable of running everywhere you need to go, but the minute you break an ankle or become ill, you may as well have never had a car in the first place.

In fact, the real threat to young adults’ access to affordable insurance coverage is not these possible premium increases, but the shortsighted decision by certain states to reject the law’s Medicaid expansion. Nearly half of all currently uninsured young adults would qualify for Medicaid under full expansion, but they will remain uninsured unless their states participate.

This brief reviews how the Affordable Care Act will affect health care coverage for young adults, looking at both the law’s private insurance market and Medicaid expansion provisions.

The Affordable Care Act expands the health coverage options of young adults

Young adults ages 19 to 29 have historically been uninsured at higher rates than any other age group, not because of a lack of desire for health coverage but because they have lacked access to affordable health coverage— only 64 percent of young adults had health insurance coverage in 2010. Responding to a 2011 survey conducted by the Commonwealth Fund, a private foundation that aims to promote a high-performing health system, 41 percent of all young adults and 60 percent of uninsured young adults said they did not receive needed health care because of the cost of care. Half of uninsured young adults also reported medical debt or problems paying medical bills, while 29 percent of insured young adults reported these problems due to the lack of sufficient health care coverage.

One major reason why young adults have been uninsured at such high rates is because prior to the Affordable Care Act, many of them aged out of their insurance coverage when they turned 19—whether they had been covered under a parent’s health plan or under Medicaid or the Children’s Health Insurance Program, better known as CHIP.

Second, a disproportionate number of young adults lack insurance because of the type of work they do. Many people in their early 20s work in low-income or temporary jobs—employment that rarely offers health insurance.

Third, this group also faced barriers to coverage in the broken individual insurance market prior to the Affordable Care Act, including discrimination based on pre-existing conditions and other practices that raised premiums or terminated coverage if a person became sick.

The Affordable Care Act tackles these problems in several ways. First, the law allows young adults to stay on their parents’ plans until they reach age 26. As of June 2012 more than 3 million young adults gained insurance coverage because of this change— a 10.4 percent increase in the number of insured young adults from 2010. Of the 13.7 million young adults with this source of coverage, about 6.6 million would not have had this option before the Affordable Care Act.

Second, the law expands Medicaid to all adults with incomes at or below 138 percent of the poverty level—currently $15,856 for individuals. Until Medicaid expansion is in place in 2014, most states limit Medicaid coverage for nondisabled adults to those with incomes well below 100 percent of the federal poverty level—$11,490 for an individual in 2013—unless the person is pregnant or parenting a minor child. These stringent eligibility criteria leave many low-income young adults, especially men—who are less likely to be parenting—without health insurance options.

Third, the Affordable Care Act’s market reforms and new health insurance exchanges will help young adults purchase quality, affordable health insurance. The exchanges are new marketplaces where individuals will purchase health insurance. Young adults without access to other health insurance will be able to go online to one site and compare their health insurance options, and the exchanges will also determine eligibility for financial assistance or Medicaid.

Young adults will find that the quality of coverage offered in the exchanges is vastly improved over most current insurance options in the individual market. These exchange plans, for example, will include prescription drug and mental-health benefits. Having access to quality insurance through the exchanges gives this group greater flexibility to explore different career and educational paths without being tied to a job for the sake of having health insurance. With guaranteed access to health insurance, young adults will be free to accept lower-wage or entry-level jobs that do not offer health insurance. They can also start their own businesses or pursue educational opportunities.

Thanks to these changes, the rates of health coverage for young adults should increase dramatically beginning in 2014. And if every state participates in Medicaid expansion, young adults would reach near universal health care coverage. Unfortunately, a number of states plan to reject Medicaid expansion.

Young adults will find affordable health care options on the new health care exchanges

The argument that young adults are harmed by the law because they may pay higher premiums is misleading. This claim fails to take into account many of the provisions of the Affordable Care Act that make coverage more affordable. For many young adults, these financial and consumer protections will lower their overall health care costs and improve their health and wellness.

Consider the following: Lower- and middle-income young adults who purchase health insurance through the exchanges qualify for different levels of financial assistance. The law offers premium tax credits on a sliding scale for individuals with incomes up to 400 percent of the federal poverty level—$45,960 for an individual in 2013. In addition, the law provides cost-sharing subsidies to individuals up to 250 percent of the federal poverty level—$28,725 for an individual in 2013—which reduces out-of-pocket costs for covered benefits. The law also includes out-of-pocket limits that are more generous at lower income levels. Finally, many of the preventive care services that young people need more frequently than other medical services will be covered at no cost. Together, these provisions offer far more financial protection than most policies currently available in the nongroup market.

The Affordable Care Act’s “catastrophic plans” are another option for young adults who might still find premiums in the nongroup market unaffordable. In the past, catastrophic plans only protected individuals in emergency circumstances. These plans would typically not have included routine primary care or preventive services, and in cases in which these services were covered, the plan-holder would first have had to meet a very high out-of-pocket deductible. The catastrophic coverage plans offered in the exchanges still have high deductibles, but those deductibles do not apply to the no-cost preventive services or up to three primary care visits. The Henry J. Kaiser Family Foundation estimates that premiums for a person in their 20s will be 29 percent less in catastrophic plans than in bronze plans, which have the lowest-priced premiums for most people shopping for insurance in the exchanges.

Debunking rate shock for young adults in the nongroup market

Currently, health insurers in the nongroup insurance market charge people approaching retirement up to five times as much for premiums as they charge younger people because of a practice known as age rating. The Affordable Care Act includes a 3-to-1 age-rating band, which limits what insurance companies can charge a 64-year-old for premiums to three times what a 21-year-old may be charged for the same coverage. As a result, more risk is shifted from older enrollees to younger enrollees.

Insurance-industry-sponsored studies claim that this limit will drastically increase premiums for young people, contributing to a scenario called “rate shock.” Opponents of the health reform law claim that these increased premiums will, in turn, discourage young, healthy people from buying insurance. If this group stays out of the exchanges, it would leave a disproportionately greater number of older, sicker individuals in the risk pool, ultimately driving up prices for those remaining until coverage becomes totally unaffordable—a phenomenon referred to as the “death spiral.”

But there are two major problems with these studies. First, their authors have not disclosed in any detail the pricing assumptions that underlie their assessment of age rating on premiums. Second, they often fail to take into account other policies implemented through the Affordable Care Act that mitigate the impact of changes in age-rating practices, such as the financial assistance detailed above and the risk-adjustment provisions of the law that serve to stabilize the health insurance market. Even those that do account for the premium tax credits do not take into account other financial assistance and protections, such as cost-sharing subsidies or out-of-pocket caps, or the increased value of coverage that itself reduces out-of-pocket costs. As a result, these studies vastly overstate the potential for rate shock and significantly downplay the benefits of the Affordable Care Act.

In fact, a recent study by the Robert Wood Johnson Foundation and the Urban Institute found that the current 5-to-1 age bands actually undercharge young adults relative to their expected expenses; the 3-to-1 age band is more consistent with this group’s expected costs. The authors of the Robert Wood Johnson study concluded that, “claims by anyone in the insurance industry that this change will have dramatic implications for the out-of-pocket costs of young adults are unfounded.” The study went on to note that few young adults will see an increase in premiums because of age rating and that those who do will only see small increases.

Census data show that among all young adults, only 3 percent might see premium increases in the nongroup market

A very small group of young adults may see premium increases due to the Affordable Care Act’s age rating and other market reforms. Data from the Census Bureau’s Current Population Survey shows that, of the nearly 47 million young Americans between the ages of 19 and 29, only about 3 percent might see higher premiums in the nongroup market. These young adults have incomes that may be too high to qualify for federal subsidies to fully offset the premium increases.

To put this finding into a larger context, this group is less than 0.5 percent of the entire United States population. It includes approximately 789,234 young people with incomes between 250 percent and 399 percent of the poverty level— currently $28,725 to $45,845 for an individual—and 652,048 young people with incomes of 400 percent of the poverty level or higher—currently $45,960 annually for an individual. Those with incomes below 400 percent of the poverty level will qualify for federal tax credits that will offset some increase in premiums.

The vast majority of young adults, however, will not see premium increases because they have employer-sponsored coverage or because they have incomes below 250 percent of poverty level—$28,725 for an individual in 2013. Young adults with incomes below this level will either qualify for Medicaid under the expansion—if their states participate—or they will receive federal subsidies for premium assistance and cost sharing that will offset any premium increases.

The figures in the above chart are conservative, and fewer young adults in this market are likely to experience higher health care costs. Some of this group may choose the less costly catastrophic coverage plan. Others may be enrolled in grandfathered plans that are exempt from many of the law’s market reforms. In Maryland, for example, 60 percent of enrollees in CareFirst insurance plans—representing about 70 percent of the nongroup insurance market in the state— will not see any increases in premiums because they will be grandfathered in their current health plans. It is also possible that some in this group may move to their parent’s insurance plans.

As we discuss below, however, premium costs only tell one part of the story. Current premiums for healthy young adults in the nongroup market may be very low, but they contain large coverage gaps and have limited to no financial protections.

Why premium amounts are not the entire story: Flintstone car versus the modern hybrid vehicle

It is misleading to compare the cost of premiums before and after the Affordable Care Act. The value of the insurance that is available to purchase post-Affordable Care Act is as distant to prereform coverage as the self-powered Flintstone mobile is to a modern hybrid vehicle.

Without the law’s reforms, sicker consumers and those with pre-existing medical conditions had a difficult, if not impossible, time finding coverage in the nongroup market. Even if they were fortunate enough to find coverage, the cost could be exorbitant and the coverage extremely limited.

Because of the Affordable Care Act’s reforms, insurance plans will offer a broader benefits package, known as essential health benefits. These changes may cause premium costs to go up, but once enrolled, the plans will pay for a greater share of medical costs, and consumers are protected by out-of-pocket limits. For these reasons, even young adults paying higher premiums may see their overall health care costs decline.

To illustrate the point: A recent study cited by opponents of the law warns that a healthy 25-year-old with an income of 300 percent of the poverty level—currently $34,470 per year for an individual—could see his or her premiums costs go up by $783 a year because of the law’s market reforms. But even if this projection is accurate, it only tells a small part of the story. Before the Affordable Care Act, a young woman’s yearly birth control and related doctor visits could have cost as much as $600 to $1,200. But because of the health reform law all exchange plans must cover recommended preventive services, including birth control and yearly doctor’s visits, at no cost. Because of this one benefit, young female enrollees will likely break even with or recuperate the difference in their premiums.

Let’s look at two other examples: The Affordable Care Act ends the practice of insurers charging young women in the nongroup market as much as 150 percent more for the same insurance coverage as young men, even when the plan excludes coverage for gender-specific conditions such as maternity care. And postreform, insurers may no longer categorize certain gender-specific conditions, such as past cesarean sections or injuries from sexual assault or domestic violence, as pre-existing conditions.

But even young, healthy men, who have historically had the lowest health care premiums, are likewise already seeing substantial benefits from the Affordable Care Act. This group has had particularly large coverage gains specifically because the law now allows them to stay on their parents’ health plans until they reach age 26. The percentage of young men ages 21 to 25 with insurance coverage has increased from 57.9 percent to 72 percent since the law’s passage. And young men in the individual market will benefit from the security of knowing that their coverage will remain constant even if they get sick or suffer an injury.

Rejecting Medicaid expansion threatens coverage for a large number of young adults, as those with low incomes are at the highest risk of being uninsured

The biggest threat to insuring young adults is not increased premium costs, but the fact that many states are still threatening to reject Medicaid expansion.

Most nondisabled, low-income children age out of Medicaid and CHIP on their 19th birthdays. But unlike their more affluent peers, these individuals generally do not have the option of staying on a parent’s health plan or purchasing their own insurance: 69 percent of young adults in families with incomes at or above 400 percent of the poverty level found coverage under their parents’ plan between November 2010 and November 2011, while only 17 percent of those with incomes under 133 percent of poverty did so.

A 2011 survey conducted by the Commonwealth Fund found that young adults in moderate- to low-income households experienced the most difficulty affording insurance coverage: 70 percent of young adults with incomes that would allow them to qualify for Medicaid expansion reported a gap in insurance coverage in 2011, more than three times the rate of young adults with incomes at or above 400 percent of the federal poverty level. Of the 10.4 million currently uninsured young adults ages 19 to 29, 45 percent would gain coverage through the law’s Medicaid-expansion provision.

In states that refuse Medicaid expansion, some low-income young adults may find coverage through their employers, but many will remain uninsured. Because policymakers planned for low-income young adults to gain coverage through Medicaid, eligibility for the law’s tax credits and other financial assistance to make the purchase of health insurance more affordable does not extend to young adults below the poverty level.

Conclusion

Those concerned about the prospect of young people lacking access to affordable health care coverage should focus on Medicaid expansion instead of the risk of higher premiums in the nongroup market. Only 3 percent of all young adults could face higher premiums in the individual market. Moreover, with this minimal increase in premium costs come significantly greater benefits. Meanwhile, a substantial number of states have threatened to reject or have already rejected Medicaid expansion, a much more concrete concern that leaves those young adults most in need of affordable health care without any options.

Maura Calsyn is the Associate Director for Health Policy at the Center for American Progress. Lindsay Rosenthal is the Research Assistant for Health Policy and Women’s Health and Rights at the Center.

The authors thank The Commonwealth Fund for providing the Census data for this brief.

SOURCE: AP/Marcio Jose Sanchez

Rachel Sorrow, a transgender woman, attends a therapy session with Dr. Dan Karasic, a psychiatrist with the Center of Excellence for Transgender Health in San Francisco, California.

Endnotes and citations are available in the PDF version of this issue brief.

*Author’s note: This article has been updated to correct an omission. The California Department of Insurance was the first regulatory entity in the nation to specifically address insurance discrimination against transgender people.

In America’s increasingly expensive health care system, the costs of not having adequate insurance coverage are both financial and physical. Without coverage, many people must choose between struggling to pay exorbitant medical bills or going without the care they need.

Similar to millions of other Americans, many transgender people lack health insurance coverage. But even when they are able to find coverage, the promise of more secure access to care and protection from unaffordable medical bills often rings hollow. This is because the majority of U.S. health insurance plans deny coverage for medical procedures and treatments seen as specific to transgender people.

This brief provides an overview of insurance discrimination against transgender people; the impact of the Affordable Care Act on insurance discrimination; and how some state insurance regulators are taking action to stop gender-identity discrimination in insurance.

SOURCE: AP/Al Goldis

Joanne Polisano, left, Mary Czartoryski, center, and Stephen Eddins join others in a rally outside the Michigan Hall of Justice in Lansing, Michigan, on April 11, 2006, following a state court of appeals hearing on whether governments and public universities can provide health insurance and other benefits to the partners of gay employees without violating the state constitution.

Last month the U.S. Supreme Court heard oral arguments in cases challenging restrictions on the recognition of marriage between same-sex couples. Importantly, one of these cases challenges the Defense of Marriage Act—the federal law defining marriage as the union between one man and one woman—meaning that the justices’ ruling will have a profound impact on federal policy that affects the nearly 650,000 American families headed by same-sex couples.

As the Court deliberates the cases in the coming weeks, however, these couples and their families must carry on with their lives and continue to navigate the numerous social systems that too often threaten their health, well-being, and economic security by denying them equal access to vital programs and benefits.

Thus, while the Supreme Court is at the center of the federal conversation about families headed by same-sex couples, federal agencies can also significantly influence the daily lives of same-sex couples and their children. In particular, policymakers implementing key provisions of the Affordable Care Act have already released rules this year that will help increase access to affordable health insurance coverage for these families, mitigating some of the significant harms posed by discriminatory laws such as the Defense of Marriage Act.

Obamacare makes insurance more affordable for families headed by same-sex couples

There is overwhelming evidence suggesting that LGBT Americans are significantly more likely to live in poverty than the general population. LGBT workers are more than twice as likely to earn less than $10,000 per year, and when sex, geography, and race are factored in, this income disparity widens.

In addition to basic income inequalities, inequalities under the law create additional financial burdens for families headed by same-sex couples. Because of the Defense of Marriage Act, same-sex couples pay higher taxes compared to married heterosexual couples, including an average tax of $1,069 per year on health insurance coverage for their spouse or partner—when they are able to access this coverage at all.

It is no surprise, then, that socioeconomic inequality has put health insurance coverage, and therefore access to many health care services, out of reach for a significant number of LGBT families. Starting next year, however, the Affordable Care Act will ease the financial burden on many American families by opening up doors to health coverage and better health care.

Under the law, individuals and families who buy coverage through a Health Insurance Marketplace will be eligible to receive subsidies for health insurance premiums if their income is less than 400 percent of the federal poverty level—$45,960 for an individual and $94,200 for a family of four in 2013. These subsidy amounts are calculated during the insurance-marketplace application process, and the amount is set based on a sliding-scale percentage of income that goes toward premiums.

Because the calculation of household income is tied to restrictive marriage definitions imposed by the Defense of Marriage Act, or DOMA, same-sex couples will have to have these subsidies individually calculated instead of jointly. Fortunately, however, nothing in federal law, including DOMA or the Affordable Care Act, restricts the ability of same-sex couples to combine their individual subsidies to purchase family coverage.

Health Insurance Marketplace policies can be LGBT inclusive

Even before the passage of the health reform law, insurers have often stepped up to offer family plans that include same-sex couples and their families.

In states that extend some form of legal recognition to LGBT families, laws often also require insurers in the individual and small-group markets to extend family coverage to domestic partners. Even in states where there are explicit prohibitions on the legal recognition of relationships between same-sex partners, insurers still frequently extend inclusive family coverage, and some states give insurance companies the explicit authority to offer benefits to these families.

The widespread nature of inclusive coverage is well demonstrated in the practices of employers: Fifty-one percent of small business offer coverage to same-sex partners of employees, and more than 60 percent of Fortune 500 companies do the same. Federal policy under the Affordable Care Act promotes the expansion of these positive market practices and authorizes the marketplaces to offer coverage that includes same-sex couples and their children in family policies available in 2014.

Recently, the U.S. Department of Health and Human Services released final regulations implementing provisions of the Affordable Care Act that reform health insurance markets across the country. These regulations address the types of coverage that insurers offer to families. In explaining the rules, the agency clearly indicated that all families need access to health coverage and that adopting a narrow definition of “family” could adversely impact the ability of diverse families such as LGBT families to access the coverage and care that they need. Accordingly, the agency explicitly gave states the flexibility to require issuers to include specific types of individuals on a family policy. Current market practices that have promoted expanding coverage for LGBT Americans and their families will thus continue to advance under the Affordable Care Act.

The U.S. Office of Personnel Management, or OPM, has also released rules that will promote access to coverage for same-sex couples and their families. In rules implementing provisions of the Affordable Care Act that establish standards for multistate plans, OPM followed the Department of Health and Human Services in refraining from adopting a definition of family that would restrict the ability of plans to offer inclusive family coverage to households headed by same-sex couples. But OPM also went a step further by indicating that it would use the contracting process to encourage plans to “provide the same benefits for all family compositions, including but not limited to same-sex domestic partners and their children.”

Conclusion

While we wait for the Supreme Court’s historic rulings in a few weeks, state and federal policymakers should continue the important work of ensuring that policies implementing the health reform law provide fair and equal access to health coverage for all Americans, including same-sex couples and their children. And despite all of the sometimes confusing news and misinformation surrounding the Affordable Care Act, LGBT Americans and their families should take heart: Many of the law’s reforms are already making a difference, with even more benefits still to come.

Andrew Cray is a Policy Analyst with the LGBT Research and Communications Project at the Center for American Progress. Kellan Baker is Associate Director of the project.

SOURCE: AP/ Charles Dharapak

Supporters of health care reform rally in front of the Supreme Court in Washington on the final day of arguments regarding the health care law signed by President Barack Obama.

A centerpiece of the Patient Protection and Affordable Care Act—often referred to as “Obamacare”—is the expansion of Medicaid eligibility to people with annual incomes below 138 percent of the federal poverty level, or $26,347 for a family of three and $15,417 for an individual. Despite the fact that the Affordable Care Act was passed into law in 2010 and was subsequently upheld by the U.S. Supreme Court in the summer of 2012, many questions persist about the law, particularly as it relates to Medicaid expansion—what that expansion actually means, who it will cover, what it will cost, and more.

As we mark the third anniversary of the passage of the Affordable Care Act, it is important not to lose perspective about what Medicaid expansion actually means for the millions of people it will help to insure, as well as the economic benefits it will bring to states and local economies. Here are the 10 questions about Medicaid expansion under the law that are asked most frequently and are too often answered incorrectly.

Who is and who isn’t gaining coverage under Medicaid expansion?

Medicaid, jointly funded by the state and the federal government, requires coverage for certain groups of individuals: low-income children and some of their parents; poor pregnant woman; certain low-income seniors; and some individuals with disabilities who are under the age of 65. Under the Affordable Care Act, Medicaid eligibility will be extended to all individuals with incomes up to 138 percent of the federal poverty level beginning in 2014—$26,347 for a family of three and $15,417 for an individual.

Medicaid expansion will cover all families and individuals below this income level, including groups who are currently left out of public health coverage such as low-income, able-bodied parents, low-income adults without children, and many low-income individuals with chronic mental illness or disabilities, who struggle to maintain well-paid jobs but don’t currently meet disability standards for Medicaid. The expansion of Medicaid eligibility also cuts the rate of uninsured veterans and Native Americans in half and provides early treatment to people struggling with HIV. Unfortunately, many of the poorest citizens in states that may decide not to expand Medicaid will be victims of a coverage gap. When the Affordable Care Act was written, federal policymakers assumed those with the lowest incomes would be covered under the expansion. Consequently, they did not set up further ways for these groups to obtain health care coverage such as the federal subsidies that those with slightly higher incomes will receive under the law.

What does the “Obamacare” Supreme Court ruling really mean?

The Supreme Court upheld the Affordable Care Act in 2012, but it gave the states the choice to opt out of Medicaid expansion. It is now rests with governors and state legislatures to decide whether it is in the best interest of the state to implement the Medicaid portion of the law that affords health coverage to those in need.

If a state chooses not to expand the program, the federal government cannot take away the Medicaid funds a state already receives. So while states have the “carrot” of extra Medicaid funding if they take up the expansion, they don’t have the “stick” of losing federal funding if they do not take it. This ability to opt out of the expansion but suffer no serious consequences undermines the law’s ability to ensure that millions of low-income Americans benefit from the expansion of Medicaid coverage. This caveat in the Court’s decision opened the door to allow governors to deny an essential aspect of health care reform. Unfortunately, states opting out of Medicaid expansion do so to the detriment of their residents, as well as their state budget.

What will Medicaid expansion actually cost states?

The federal government is paying for the vast majority of the Medicaid expansion. States don’t have to pay any percentage of the cost for the expansion until 2017, at which point the federal government will gradually transition to covering 90 percent of the cost through 2020. Before accounting for state and local government increases in savings and revenues, the nonpartisan Congressional Budget Office estimates that states will increase their Medicaid spending by only 2.8 percent while providing health coverage to 17 million more low-income children and adults between 2014 and 2022.

States that expand their Medicaid coverage will not incur unsustainable costs; rather they will enjoy net fiscal gains due to offsets in savings and increases in revenues. Sources of increased revenues include state sales taxes, insurance taxes, and prescription-drug rebates. States will also incur savings, as the federal government will be paying a much higher share of the cost for populations that were previously ineligible and therefore solely paid for by states. This will free up billions of dollars from state budgets, as is the case in Florida, where projected annual savings are $100 million, and in Ohio where projections call for $1.9 billion in savings and increased revenues by 2022. Coverage for women with breast and cervical cancer, and coverage for some mental health and substance-abuse treatment for previously uninsured poor individuals can now be covered by Medicaid, as opposed to what was previously covered solely by states.

Some states are acknowledging that they could afford the expansion, but they fear the federal government will “cut-and-run” at some point, leaving them with a majority of the cost burden. The reality is, however, that there is absolutely no precedent for this. Moreover, if a state is committed to expanding Medicaid, there are ways to address this concern. Both Arizona and Nevada, for example, have adopted the “circuit-breaker” approach, in which the state will opt-out of the expansion only if the federal government’s share of matching funds falls below a certain level.

What are the costs if Medicaid isn’t expanded?

There is both a human and fiscal cost if Medicaid expansion is rejected. States will have to continue to pay for the treatment of the uninsured in hospitals, public clinics, and other care facilities with state tax dollars, which is much more expensive than the minimal share they’d pay under the Medicaid expansion. And when it comes to the impact of Medicaid coverage, several studies indicate that Medicaid coverage leads to overall better health and lower mortality rates. According to a study by the state of Oregon, after one year of enrollment in Medicaid, low-income childless adults significantly reduced their financial strain, increased their health care use, and reported having overall better health. Expanded Medicaid coverage also led to decreased rates of delayed care and decreased mortality rates, especially among residents of poorer counties, as indicated by the New England Journal of Medicine.

Where do the federal dollars go when a state decides not to expand Medicaid?

When a state chooses to forgo expansion, it does not receive the extra funding from the federal government. This means residents’ federal tax dollars will still be going toward the implementation of Medicaid expansion in other states but not in their own. This is a scenario that Gov. Jan Brewer (R) of Arizona, an outspoken foe of Obamacare, cites when explaining her surprising support for Medicaid expansion. Gov. Brewer doesn’t want to forfeit federal funds that will otherwise go to states that have agreed to expansion, which is why she has also agreed to it.

How will low-income individuals and families benefit from Medicaid expansion?

For the millions of low-income adults and children who would become eligible for care, Medicaid expansion is much more than access to health insurance. Every dollar a mother doesn’t need to spend on out-of-pocket costs when her child comes down with the flu can go toward food, housing, and other necessities. Medicaid coverage translates into financial flexibility for families and individuals, allowing limited dollars to be spent on basic needs, including breakfast for the majority of the month or a new pair of shoes for a job interview. Medicaid expansion means more than health care coverage; it is an expanded opportunity for success and a pathway to the middle class.

Does Medicaid expansion take flexibility away from the states?

According to Department of Health and Human Services Secretary Kathleen Sebelius, states may adapt the Medicaid expansion so that is meets their unique needs. Expansion is an opportunity for innovation, and even allows for the program to be modeled after private plans, as Arkansas has proposed. The Arkansas model would use federal Medicaid dollars to provide the state’s lowest-income populations with private insurance. The Affordable Care Act proposes that the state oversees Medicaid merely as an attempt at proper protection and choices for beneficiaries. But just as there is no “one-size-fits-all” in current Medicaid programs, there are likely many different ways states can grow and expand their particular programs while still ensuring millions of low-income individuals gain health coverage.

What does it mean for Medicaid expansion to run through private insurers?

This means that the money that the federal government is giving each state to expand its Medicaid enrollment will go toward helping prospective Medicaid recipients purchase private insurance in the new health insurance exchanges. This is a path that several states are considering but hesitant to adopt. One reason cited in support of expanding with this option is that providers would be paid the same amount whether a patient is a recipient of Medicaid or private insurance, which theoretically may increase the array of doctors who will treat Medicaid patients. Additionally, it would make the program run more smoothly and would provide continuity as beneficiaries’ income levels may fluctuate, forcing them to switch between their expanded Medicaid coverage and a private insurer in the state marketplace. But the Department of Health and Human Services agreed to a Medicaid bridge plan, which mitigates this worry by allowing individuals transitioning from Medicaid coverage to coverage through a health exchange to remain with the same plan and provider network.

This approach, however, requires monitoring going forward because it comes with many risks. If states that are otherwise unwilling to expand their Medicaid program are willing to try this approach, it could help guarantee that millions more individuals will have access to health care. Medicaid is crucial because of the array of benefits it provides, which for the newly eligible include hospitalization, maternity and newborn care, emergency services, and preventative care. Under the Medicaid law, this approach must provide the same benefits as the traditional Medicaid program in a cost-effective manner, and it is yet to be seen if states can meet this standard.

Will Medicaid expansion help the economy?

When hundreds of thousands of individuals in a state are gaining health care coverage, there must also be thousands of health care professionals available to care for them. Likewise, there will be an increased demand for equipment for medical tests, the production of extra beds, more maintenance jobs at growing health care facilities—the list goes on. In short, Medicaid expansion is an engine for job creation.

According to the Health Policy Institute of Ohio, by 2015 Medicaid expansion will create at least 23,000 new Ohio jobs in health care and other related industries, increase the earnings of Ohio residents by at least $16.7 billion, and increase the state’s total economic activity by at least $18.6 billion from 2014 to 2022. In fact, costs to employers could total $876 million to $1.3 billion in the states that oppose, are leaning against, or remain undecided on expansion as the result of penalties for noncompliance with the Affordable Care Act.

What’s so important about the expansion of Medicaid?

As is, Medicaid is incredibly effective at providing coverage for one in every four children, 21 percent of low-income adults, and 60 percent of nursing-home residents nationwide. If Medicaid didn’t exist, most of the 50 million Americans whose coverage comes solely from Medicaid would join the ranks of the more than 40 million individuals in this country who are currently uninsured. Expansion of Medicaid coverage for low-income pregnant women led to a significant reduction in infant mortality, and the expansion of coverage for low-income children in the 1980s and early 1990s led to a significant reduction in child deaths.

Conclusion

At its core, Medicaid provides coverage for the poorest and most disadvantaged Americans and provides economic security for the middle class. Medicaid’s federal-state partnership structure is an effective way to provide care and assistance to individuals who need it most. Medicaid’s purpose and its laudable track record must be considered when arguing the merits of its expansion through the Affordable Care Act.

Sarah Baron is a Special Assistant at the Center for American Progress.

SOURCE: AP/Haraz N. Ghanbari

The U.S. Supreme Court in Washington is seen March 24, 2012, two days before the court began hearing arguments on the constitutionality of the Affordable Care Act. The Supreme Court later upheld the law and made Medicaid expansion optional for states.

Research shows a strong connection between mortality rates and insurance status: The uninsured are more likely to have poor health and higher mortality rates than those with insurance. People without insurance are less likely to receive preventive services and more likely to delay or go without necessary doctors’ visits, prescription medicines, and other treatments that reduce unnecessary morbidity and premature death. As a result, this group has poorer health outcomes, a lower quality of life, and more premature deaths. The uninsured are also at greater risk of death following a trauma, heart attack, or stroke.

A study—“Mortality and Access to Care among Adults after State Medicaid Expansions”—published in the New England Journal of Medicine last year analyzed the effects of Medicaid expansion on adult mortality in several states and found a connection between access to Medicaid and reduced mortality. This study underscores the importance of the current debate that is taking place in many states about whether to expand Medicaid as part of the Affordable Care Act.

To ensure that those who most need health coverage can access care, the Affordable Care Act expanded the federal minimum Medicaid eligibility level to all people with incomes up to 138 percent of the poverty line—$15,856 for individuals and $32,499 for a family of four in 2013.* But the Supreme Court decision that upheld the health care law also allows states to opt out of the expansion without losing their existing federal Medicaid funds. This means that, unfortunately, Medicaid coverage is not yet guaranteed for many Americans in this group. Nearly 17 million Americans would gain coverage through the Medicaid expansion if all states participated in the expansion, which could improve the health status of millions of Americans and reduce mortality rates.

The graphic below estimates the number of deaths that could be averted in some of the states that continue to oppose Medicaid expansion. This is not an exhaustive list of states—we only included states that currently have low thresholds for Medicaid eligibility for nondisabled adults so that our estimates would be conservative and would not overstate the potential impact of expansion on averted mortality in a given state.

Methods

The researchers of the New England Journal of Medicine study compared mortality levels in several states that implemented a Medicaid expansion to demographically and economically similar states that did not implement a Medicaid expansion in order to determine the effects of the expansion on adult mortality over a period of five years. Since the study was limited to only a few states, there may be some variation across estimates depending on how Medicaid expansion is implemented in each state.

Based on the results of the study, we applied the ratio of 2,840 averted deaths within a state population of 14.5 million people to the population of adults between the ages of 19 and 64 in every state to estimate how many lives could be saved through Medicaid expansion. The proportion is based on the average averted mortality rate of states in the original study. The actual estimates for averted deaths for each state will vary depending on the baseline numbers of uninsured and enrollment rates after Medicaid expansion is implemented. State population data is taken from the Kaiser State Health Facts and represents a two-year average of state populations between the ages of 19 and 64 in every state.

Conclusion

In these states alone more than 12,000 lives per year could potentially be saved if state governments agree to expand their Medicaid programs. Let us not lose sight of what is really at stake in the battle over Medicaid.

Maura Calsyn is the Associate Director of the Health Policy team at the Center for American Progress. Lindsay Rosenthal is a Research Assistant on the Health Policy and the Women’s Health and Rights teams at the Center.

* The Affordable Care Act includes a special adjustment to income that effectively raises the eligibility level by 5 percentage points to 138 percent of the poverty level.

SOURCE: AP/Charlie Riedel

Evelyn Craig, left, executive director of reStart Inc., and LaTonya Jenkins, a reStart client who lives at the facility, pose at the homeless shelter in Kansas City, Missouri, March 19, 2013. The women are concerned that Missouri's refusal to expand Medicaid under the Affordable Care Act will harm residents of the shelter such as Jenkins.

This month marks the third anniversary of the enactment of the Patient Protection and Affordable Care Act, the landmark health care reform legislation that was a victory in many ways for women’s health. Thanks to the Affordable Care Act, women’s access to high-quality, affordable health care will increase dramatically, as key reforms are implemented and the country moves toward near-universal health coverage.

Due largely to the high cost of health care coverage—especially for women without access to employer-based coverage—19 million American women between the ages of 18 and 64 were uninsured in 2011. Uninsured women receive lower-quality care, and they generally have poorer health outcomes than insured women. Beginning October 1, 2013, however, millions of Americans will be able to shop for health insurance and compare plans through marketplaces known as exchanges, where some consumers may also be eligible for subsidies to help them afford coverage. The reform has also expanded access for low-income women by expanding Medicaid, and many states have already agreed to expand coverage under the program.

Below are the top three achievements to celebrate, the top three things to look forward to, and the top three items that we need to put on our agenda in order to advance women’s health through the Affordable Care Act.

3 achievements to celebrate now

Most of the law’s benefits will begin to take effect in 2014, but the law is already having an impact in a number of ways. Here are the top three benefits that have taken effect so far.

No-cost coverage for contraception and other preventive services

Since August 1, 2012, the Affordable Care Act has required all new, nongrandfathered health care plans to provide women with no-cost coverage for all methods of contraception and sterilization approved by the Food and Drug Administration, as well as host of other preventive services, including annual well-woman visits; lactation consultation and supplies; screening and counseling for interpersonal and domestic violence; screening for gestational diabetes; DNA testing for the human papillomavirus, or HPV, for women ages 30 and older; counseling for sexually transmitted infections; counseling and screening for HIV; and more.

Nearly 27 million women have already accessed at least one of these no-cost preventive services as of March 2013, and millions more are expected to access these services when the law’s major coverage expansions are implemented in 2014.

Protections for children

Women make the majority of health care decisions for themselves and their families. They can now rest a little easier knowing that there are fewer barriers to getting the coverage and care that their children need.

The Affordable Care Act has already made it illegal to deny children coverage because of a pre-existing health condition. In other words, plans may not exclude children who are under the age of 19 based on a health problem or disability that the child developed before a parent applied for coverage.

In addition, the law has already allowed young adults to stay on their parent’s health insurance policy until they are 26 years old, which has benefited young women who would otherwise be uninsured. More than 3 million young people have gained coverage though this provision, and the rate of insurance coverage for young women ages 21 to 25 increased from 71.2 percent to 77.5 percent since the law went into effect.

Finally, the law requires plans to cover preventive services for children such as vaccinations and well-baby and well-child visits without a co-pay.

Increasing affordability and consumer protections

Prior to the passage of the Affordable Care Act, 39.5 million women and 28 million children were enrolled in health insurance plans that had lifetime limits on their coverage. Women were hit especially hard by these limits, as they are more likely than men to suffer from chronic conditions. This meant that a woman who was diagnosed with a chronic condition or serious illness such as breast cancer, or a woman who had a child with a serious condition, would find that her insurer would cover only a fixed amount of medical costs and refuse to cover any additional expenses. These families would essentially lose coverage for their medical care precisely when they needed it most.

The Affordable Care Act has already prevented insurance companies from imposing lifetime limits on coverage, and it has begun phasing out annual limits on coverage, which have had a similarly detrimental effect. Beginning in 2014 annual limits will be eliminated entirely.

3 things to look forward to

Here are the top three reforms for women that are in the pipeline for 2014.

Ending discriminatory exclusions against women in the health insurance market

Prior to the Affordable Care Act, women were denied coverage for certain gender-specific conditions such as breast cancer or having had a Caesarean section. Even sexual assault and domestic violence were sometimes categorized as pre-existing conditions. But as of 2014 it will no longer be legal to deny women coverage because of a pre-existing condition.

Ending gender rating

In 2014 the Affordable Care Act will also end gender rating, a common practice in the individual insurance market where insurers frequently charged women as much as 150 percent more for their premiums solely because of their gender. One study found that women were charged $1 billion more per year in premiums for the same coverage as men. The new provision, however, will ensure that women have coverage for the care that they need without receiving this discriminatory treatment.

Ensuring that women have access to coverage for maternity care

Having a baby is an expensive endeavor. One study found that the average cost of a healthy birth in the United States is more than $8,000 for prenatal care and delivery alone—and costs only increase for complicated deliveries. Prior to the Affordable Care Act, 88 percent of individual-market insurance plans did not cover maternity care, which has created a significant barrier to obtaining needed care during pregnancy.

Beginning in 2014, however, all nongrandfathered health plans in the individual market will have to offer an essential-health-benefits package that includes coverage for maternal health services. Having this coverage will make a tremendous difference in women’s ability to access the care they need during pregnancy, protecting their own health and the health of their children.

3 items to add to the agenda in 2014 and beyond

While many accomplishments have been made in the area of women’s health since the Affordable Care Act was enacted, there is still plenty of work to be done to ensure that women have the coverage and care that they need. The following are three items that must be on our health care reform agenda in order to continue the progress that we have made for women’s health.

Push for Medicaid expansion in every state

Low-income Americans, and women in particular, face significant health disparities relative to more affluent Americans in large part because of inequitable access to insurance coverage and health care.

To ensure that low-income Americans can gain access to the health insurance coverage that they need, the Affordable Care Act expanded Medicaid eligibility to all people with incomes up to 138 percent of the poverty line—$14,856 a year for individuals—regardless of whether they are pregnant or parenting. Of the 17 million uninsured Americans who could become newly eligible for coverage under the Medicaid expansion, at least 7 million are women. But at least 4 million of those women live in states that have rejected the expansion or have not yet decided whether to expand coverage.

Without access to Medicaid coverage, low-income women in these states will have nowhere to turn to for health insurance and will continue to be at greater risk for poor health outcomes. We must continue pushing for all states to expand their Medicaid programs to ensure that these women’s health needs are not ignored.

Fight to ensure abortion will be covered in the health insurance exchanges

The Affordable Care Act includes language that allows states to pass legislation prohibiting private insurance plans in their exchanges from offering abortion coverage. In at least 21 states already, women will be prohibited from buying a private insurance plan that covers abortion in their health insurance exchange, and some of these states have gone so far as to ban abortion coverage in all private insurance plans in their state, including those remaining outside of the exchanges.

Creating this additional barrier to abortion coverage will hinder access to abortion for all women, but it will especially work to further increase disparities for lower-income women. We must keep fighting for abortion coverage to be included in the exchanges.

Defend against attempts to repeal the Affordable Care Act and decimate Medicaid coverage through block grants

There have been almost constant efforts by lawmakers on Capitol Hill to repeal some or all of the health care law. Some Republican lawmakers have also worked to replace guaranteed federal funding for Medicaid with block grants to the states, which would dramatically reduce federal spending on Medicaid and force states to cut back on coverage and benefits.

Both of these proposals would harm women around the country by turning back the clock on the gains made to improve access to quality health care. We cannot allow these erosions to occur.

Conclusion

After just three short years, women have already benefited significantly from the Affordable Care Act, and there is a great deal more to which we can look forward. But there is still a lot to be done to ensure that women have access to affordable and high-quality health care as we continue with the implementation of this historic law.

Lindsay Rosenthal is a Research Assistant with the Health Policy program and the Women’s Health and Rights program at the Center for American Progress.

SOURCE: AP/Seth Wenig

Brianny Abreu, 6, has her vitals checked at the William F. Ryan Community Health Center in New York, Wednesday, June 27, 2012.

This past Saturday marked the third anniversary of the enactment of the Patient Protection and Affordable Care Act, also known as Obamacare, which includes sweeping reforms of our health care system. Although health care consumers will see some of the landmark law’s biggest changes beginning in 2014, many of the law’s reforms have already benefited millions of Americans.

Below we document the many ways in which the Affordable Care Act is helping millions of Americans by ensuring they have access to high-quality affordable coverage.

Improving access to health care

Increasing affordability and expanding coverage

The Affordable Care Act provides large coverage gains by allowing young adults to remain on their parents’ insurance plans until age 26, which has been particularly important to American families as the economy struggles to get back on its feet. Because of this provision, more than 6.6 million additional young adults, including more than 1.3 million minorities—many of them new college graduates—had access to coverage even if they were unable to find a job. Notably, coverage gains by young adults are wholly attributable to increases in private coverage with no change to Medicaid coverage. As a result, nearly 75 percent of all young adults now has insurance coverage, with the largest coverage gains among young men ages 19 to 25. Due to the extension of dependent health coverage, the rate of coverage for this group increased from 58 percent to 72 percent.

Protecting those with pre-existing conditions

Additionally, many patients with pre-existing medical conditions—including asthma, heart disease, previous injuries, and cancer—would not have access to necessary affordable care without health reform. The health law prohibits insurance companies from charging higher premiums, limiting benefits, or denying coverage to those who need it starting in 2014. But to ensure that those with pre-existing conditions can access the care they need immediately, the Affordable Care Act created the Pre-existing Condition Insurance Plan, or PCIP, which includes coverage for primary and specialty care, hospital services, and prescription drugs. As of January 2013 more than 107,000 Americans had enrolled in the plan, a more than 800-percent enrollment increase since November 2010. Beginning in 2014 these enrollees will be able to access coverage through the health exchanges, where insurers will be prohibited from charging more or denying coverage to anyone based on their health. And because of the Affordable Care Act, health care plans are already prohibited from denying coverage to children because of pre-existing conditions.

Providing health care to children through school-based health centers

The law also includes more than $200 million in funding to support and expand school-based health centers, which provide primary care, dental care, behavioral health services, and substance-abuse counseling to youth nationwide. In 2012 the Department of Health and Human Services awarded more than $80 million to 197 centers across the country to improve children’s health through important screenings and disease-prevention activities.

Supporting community health centers that provide care to vulnerable populations

Obamacare also provides support to build and renovate community health centers. According to the Department of Health and Human Services, the law has already funded 190 construction and renovation projects at health centers with 67 completely new health center sites being created and more growth planned for the next two years. More than 800 of the existing centers received support to become patient-centered medical homes, allowing them to provide more coordinated care to patients.

Increasing the number of health care providers

The law also increases the number of health care providers—including mental and behavioral health providers and those serving medically underserved communities. The National Health Services Corp, for instance—a program of the Department of Health and Human Services that provides loan-repayment assistance and scholarships to health care providers serving medically underserved communities—tripled in size over the past three years. Doctors and nurses supported by this program are providing care to 10.4 million patients across the country. In 2012 the Department of Health and Human Services invested more than $229 million in the Services Corp.

Lowering health care costs and improving quality of care

In addition to increasing access to insurance, the Affordable Care Act also contains important provisions to improve the quality of our health care while controlling rapidly rising health care costs.

Reducing costs in Medicare while improving care and lowering costs for seniors

Obamacare helped slow the growth rate of Medicare spending, putting the program on a more sustainable path—with no reduction in benefits to seniors. In fact, the law ensured that in 2012 alone, 19 million Medicare beneficiaries received at least one preventive service such as an annual wellness visit or critical health screening at no cost.

Seniors and persons with disabilities enrolled in Medicare also saved $5.1 billion on prescription drugs thanks to the law. The Affordable Care Act is working to close the Medicare Part D prescription-drug coverage gap, also known as the “donut hole.” In the first 10 months of 2012, nearly 2.8 million individuals saved an average of $677 a year—and will save an average of $5,000 through 2022.

Medicare beneficiaries also realize significant savings through the health care law’s competitive bidding program for medical equipment such as wheelchairs and hospital beds. Beneficiaries are seeing $133.03 in savings per year for diabetic testing supplies, for example. In its first year the program saved taxpayers and beneficiaries more than $200 million and could save up to $42.8 billion for taxpayers and beneficiaries over the next decade. The law has also allowed the Department of Health and Human Services and the Department of Justice to crack down on fraud and abuse in Medicare, saving billions of dollars for taxpayers. The departments’ joint efforts have recovered $10.7 billion of fraudulent claims.

The Affordable Care Act includes $10 billion in government funding to support efforts to expand and strengthen the primary-care workforce and to improve public health through the Prevention and Public Health Fund. The fund, designed to help create the necessary infrastructure to prevent and detect disease and manage chronic conditions, creates additional primary-care residency slots and increases the number of trained nurse practitioners, among other things. Since the act was passed in 2010, the Department of Health and Human Services has invested $2.25 billion across the country to promote wellness, prevent disease, and protect against public health emergencies.

The health care law’s rule on preventable hospital readmissions has also helped improve the quality of care for patients nationwide. Due to Obamacare, the nationwide rate of hospital readmissions for Medicare patients within 30 days declined to less than 18 percent after at least five years of no progress.

Additionally, the Partnership for Patients: Better Care, Lower Costs public-private initiative brings together leaders of more than 3,700 hospitals with employers, physicians, nurses, and patient advocates along with state and federal governments in a shared effort to make hospital care safer, more reliable, and less costly. The initiative aims to reduce preventable hospital-acquired conditions and preventable readmissions by 40 percent and 20 percent, respectively, by the end of 2013.

Thirty-two leading health care organizations across the country are also participating in an initiative to provide better, more coordinated care to Medicare patients with potential savings of $1.1 billion. The Pioneer Accountable Care Organizations initiative rewards care providers for improving Medicare patients’ health and lowering costs through improved care coordination. The payment models that the participating organizations are piloting will allow providers to move away from a volume-based fee-for-service payment system to one based on the quality of care provided. In the past year, 106 more groups have formed accountable care organizations, or ACOs, and are now participating in the Medicare Shared Saving Program, another new accountable-care initiative in the Affordable Care Act.

Providing preventive services at no cost to patients

The law also requires insurance plans to cover important preventive services for children and adults, including critical immunizations, numerous health screenings, and counseling services, with no cost sharing. As a result, in 2011 and 2012, 105 million Americans accessed at least one preventive health service—such as a flu shot or an annual wellness visit—with no cost sharing. Beginning in August 2012, 47 million women had access to more comprehensive preventive women’s care, including mammograms, well-woman visits, contraception, and breastfeeding support with no out-of-pocket costs.

Protecting consumers nationwide

Importantly, Obamacare contains far-reaching consumer rights and protections.

Prohibiting common forms of discrimination in the insurance market

In addition to prohibiting insurers from denying coverage to patients with pre-existing conditions, the law also eliminated lifetime coverage limits—a dollar limit set by insurers on spending for covered benefits over the time a patient is enrolled in a plan—for 105 million Americans, ensuring that those who need coverage the most cannot max out their health insurance. Without the Affordable Care Act, the Department of Health and Human Services estimated that nearly 40 million women and 28 million children would be in plans with lifetime limits. The law also prohibits insurers from charging women higher premiums based solely on their gender.

Increasing transparency in the health insurance market

Thanks to the law, insurers were also required to provide consumers with easy-to-understand information about their health plans and costs by September 2012. Insurers were required to have two key documents available to help consumers evaluate their health care choices: a short summary of benefits and coverage, and a standardized glossary of terms commonly used in health insurance such as “deductible” and “co-payment.”

Saving consumers money by protecting them from unreasonable rate hikes and requiring insurance companies to spend money on patient care not administrative costs

Patients also enjoy greater protection from unreasonable private insurance premium hikes through strengthened rate-review laws that bring greater transparency and accountability to private-insurance rate increases. These protections saved consumers $1 billion on insurance premiums and have increased transparency in the health care system. Forty-two states, the District of Columbia, and five U.S. territories improved their rate-review processes under the Affordable Care Act. Connecticut and Oregon, for example, saved consumers money by rejecting a 20 percent rate increase and halving the rate increase by a large insurer, respectively.

Additionally, the Affordable Care Act prohibits insurance companies from spending more than 20 percent of premium dollars on nonmedical expenses such as administrative costs and marketing. If insurers violate the 80/20 standard—also called the Medical Loss Ratio—they must return the money to patients through rebate checks. Thirteen million consumers also received $1.1 billion in rebates from insurance companies—an average of $151 for each family covered by a policy—that spent less than 80 percent of consumers’ premium dollars on health care in 2011.

Conclusion

Beginning October 1, 2013, millions of Americans will be able to shop for health insurance and compare plans through health insurance exchanges. In these marketplaces, consumers will be able to compare estimated plan costs and select from a range of qualified plans. Some consumers may also be financially eligible for premium tax credits and cost-sharing assistance. Approximately 9 million Americans are projected to gain coverage through the exchange in 2014, with the number covered by an exchange plan rising to 25 million by 2022.

Another 15 million Americans will also gain critical health coverage through the law’s sizable incentives for states to expand Medicaid eligibility to all adults with incomes below 138 percent of the federal poverty level. The 2012 Supreme Court decision upholding the Affordable Care Act makes this expansion optional for states, however, and as of March 2013, only about half of all states announced a commitment to expand the program to cover low-income families in their states starting in 2014.

Nevertheless, Obamacare’s changes to the way our health care is delivered and paid for have already benefited millions of American families. And with some of the law’s biggest changes coming in 2014, the Affordable Care Act is poised to improve care for millions more American families.

Emily Oshima Lee is a Policy Analyst at the Center for American Progress. Special thanks to CAP intern Megan Knauss for her research support on this column.

Dr. Hamsakumari Ramasubramaniam, left, examines patient Fabian Vasquez at Camillus Health Concern in Miami. Camillus is a private, non-profit organization that provides health care to the homeless, poor, and uninsured in Miami-Dade County.

Reforming America’s health care system is a massive undertaking. The sheer scale of the effort means that the Affordable Care Act will touch the lives of every American—including millions of Americans who are frequently excluded from vital health insurance coverage and denied health care services. Gay* and transgender people and people living with HIV or AIDS are two of the groups whose access to coverage and care has the potential to change dramatically under the health reform law.

On March 18, 2013, CAP hosted an event, “A New Era of Inclusion,” to highlight this important issue. In her introductory remarks CAP President and CEO Neera Tanden stated that:

Here at CAP, we are leveraging the implementation of the Affordable Care Act to eliminate barriers that keep gay and transgender people and people with HIV from achieving the high attainable health care that they need. The LGBT State Exchange Project is working across the country for better data collection, better consumer protections, comprehensive and reliable insurance benefits, and the successful implementation of the Medicaid expansion.

Following Tanden’s introduction, Kellan Baker, the Associate Director of CAP’s LGBT Research and Communications Project, discussed the health and health care access disparities that gay and transgender people face, including the following concerns:

• There are more than 9 million Americans who identify as lesbian, gay, bisexual, or transgender, but federal and state governments do not routinely collect data on the health needs or experiences of this population.
• Gay and transgender people face discrimination and violence that are both structural and physical in employment, housing, education, health care, and other areas of daily life.
• Many U.S. states and the federal government do not recognize same-sex relationships, which deprives many of these couples of social support, economic and health insurance benefits, and legal protections that are available to heterosexual couples.
• Many transgender people have difficulty changing their identity documents to accurately reflect their name and gender after gender transition, putting them at high risk of discrimination and even physical violence.
• Most health care providers do not receive training about working with gay and transgender patients, and may intentionally or unintentionally provide worse care as a result.
• Gay and transgender people—especially those who are parents, women, transgender people, or people of color—are more likely than the general population to live in poverty.
• Many gay, transgender, queer, or questioning young people are kicked out of their homes for their sexual orientation or gender identity, and an estimated 40 percent of the U.S. homeless youth population is gay or transgender.

As a result of these and other factors, gay and transgender people tend to have worse insurance coverage, have less access to health care, and get diagnosed with conditions such as breast cancer, depression, and HIV more often.

Baker highlighted several aspects of the Affordable Care Act that have particular potential to address these disparities, including better data collection on sexual orientation and gender identity, new gay and transgender-inclusive nondiscrimination protections, insurance market reforms that promote access to more comprehensive benefits, and the extension of insurance coverage to more than 30 million Americans through the expansion of the Medicaid program and the establishment of the state-based health insurance marketplaces.

Dr. Jennifer Kates, vice president and director of global health and HIV policy at the Kaiser Family Foundation, gave a presentation on the Affordable Care Act and its effect on people living with HIV/AIDS. She noted that gay and bisexual men comprise 66 percent of new infections, and that only one-quarter of people living with HIV are in regular care. In her remarks Kates underlined several provisions of the health reform law that are particularly important for those with HIV, including an end to annual and lifetime coverage limits, the elimination of pre-existing condition exclusions, and the closing of the “donut hole” in prescription drug coverage under Medicare Part D.

Kates also highlighted the importance of the Medicaid expansion for those living with HIV. According to her presentation, “people with HIV are more likely to be low-income and uninsured than the U.S. population overall and have a heavy reliance on Medicaid,” but only about 68 percent of people living with HIV live in states that plan to expand their Medicaid programs as the Affordable Care Act requires. A Supreme Court decision in June 2012 has effectively rendered this requirement optional for the states.

Aisha Moodie-Mills, CAP’s advisor on LGBT policy and racial justice and the director of the FIRE Initiative, moderated the subsequent discussion panel. This panel included Jeffrey Crowley, distinguished scholar and program director of the National HIV/AIDS Initiative at the O’Neill Institute for National and Global Health Law at Georgetown University; Mayra Alvarez, director of public health policy in the Office of Health Reform at the U.S. Department of Health and Human Services; Kali Lindsey, director of legislative and public affairs at the National Minority AIDS Council; Susan T. Sherry, deputy director of Community Catalyst; and Kellan Baker.

Moodie-Mills opened the panel by noting that discrimination and socioeconomic inequality continually push gay and transgender people and people with HIV toward the margins of our country’s health care system. When asked why it was important to talk about gay and transgender people and people living with HIV as part of the implementation of the Affordable Care Act, Baker replied that:

First, it is because gay and bisexual men, particularly men of color, are the population where new infections are still rising. LGBT populations are still overwhelmingly disproportionately affected by HIV. The other reason is that the Affordable Care Act has some of the tools to change a health care system that isn’t working for LGBT people and people living with HIV.

All panelists agreed that implementing the health reform law will require new partnerships between federal and state governments, consumer health advocates, gay and transgender health advocates, and advocates for people living with HIV. As Alvarez noted, “The federal government won’t be able to reach everyone, and we need to take a train-the-trainer approach.” Baker echoed the concern that more than two-thirds of those who will benefit most from the Affordable Care Act don’t actually know anything about the law. Sherry discussed examples of partnerships in states such as New York and Maryland, where health reform advocates, communities of faith, and gay and transgender advocates are working together to address the needs of marginalized communities.

As several panelists emphasized, health reform must fundamentally be about the principle of universal design. In taking this historic opportunity to build a health system that works better for gay and transgender people and people living with HIV, we are helping to build a system that will work better for everyone.

Kellan Baker is the Associate Director of the LGBT Research and Communications Project at American Progress. Christopher Frost is an intern with the Project.

* The term “gay” is used in this column as an umbrella term for those who identify as lesbian, gay, and bisexual.