As cases of COVID-19 continue to rise across the country, millions of Americans face an unparalleled health insurance crisis.
The economic fallout of the COVID-19 pandemic has led to job losses for millions of workers, consequently putting their job-based health insurance at risk. Researchers at the Kaiser Family Foundation (KFF) looked at Americans who had filed for unemployment benefits and found that 26.8 million people with a job loss could lose their health insurance, according to Larry Levitt, Executive Vice President for Special Initiatives at KFF and co-executive director of the Kaiser Initiative on Health Reform and Private Insurance.
“With massive and rapid job losses during the current economic crises related to the coronavirus disease 2019 (COVID-19) pandemic, the U.S. is at risk of a historic decrease in job-based health insurance,” Levitt said in an article in the Journal of the American Medical Association Health Forum.
As of July 22, America has seen approximately 4 million cases of COVID-19 and over 140,000 deaths. More than 2 million Americans continue to actively battle the disease that can leave patients with debilitating lifelong injury to their respiratory systems, nervous systems and organs. Some coronavirus patients have reported coming out of the hospital only to face exorbitant hospital bills.
And yet, in just three months from March to May, the number of adults without health insurance increased by 5.4 million – the largest loss of coverage in American history, nearly 40 percent greater than the greatest annual increase in uninsured adults previously recorded, said Families USA, a non-partisan consumer advocacy group.
“These record-breaking increases in the number of uninsured have taken place during the country’s worst public-health crisis in more than a century and the sharpest and deepest economic downturn since World War II,” Families USA said. “Nevertheless, no federal COVID-19 legislation signed into law has attempted to restore or preserve comprehensive health insurance.”
In some cases, employers may continue to provide health insurance benefits for employees who have been furloughed. But for those without employer-paid insurance, options for coverage are few.
The Affordable Care Act (ACA), passed in 2010, was designed to be a safety net for Americans who lose employer-based insurance. And for Americans with low or modest incomes, premium subsidies can help cover the cost of the insurance, Levitt said.
“The ACA has the potential to cover a large share of people who lose job-based health insurance, but this crisis may also expose weaknesses in the law’s design, how it has been implemented, and how it has been weakened by the Trump administration,” Levitt said.
KFF estimates that 79 percent of the 26.8 million people who could potentially lose their health insurance because of job losses will qualify for government assistance when it comes to paying for health care – either through Medicaid or ACA premium subsidies.
The key will be ensuring that people know the ACA option is available to them, and helping people navigate through the complex process of signing up online, he said.
But experts say that after a decade, the ACA has not been affordable to the more than 25 million who earn too much to qualify for subsidies but can’t afford the high premiums.
One group that has been left struggling to find more affordable health care options and who don’t qualify for employer-sponsored plans are the millions of self-employed, people like real estate agents, truck drivers, small business owners, and gig economy workers such as ride-share drivers.
An option that self-employed workers should consider are plans that help individuals form a partnership and gain access to affordable, flexible group health coverage.
The ERISA Access Serving Everyone (EASE) Alliance is a nonprofit that promotes alternatives to the ACA, such as “EASE” plans, that allow individuals to become members of a partnership that purchases group insurance together. Many of these individuals do not qualify for Obamacare subsidies, due to income, immigration status, or other factors.
One of the main advantages of ERISA plans over Obamacare is their flexibility – people can choose the type and amount of coverage they need, rather than being forced into “one-size-fits-all” plans. ERISA stands for Employee Retirement Income Security Act, a law passed in 1974 that set minimum standards for retirement and health insurance plans. Currently available EASE plans range from low-cost basic preventative coverage to full major medical, with much lower costs and deductibles than Obamacare.
By joining an EASE plan, individuals are able to access flexible health care coverage that can be between 20 and 75 percent of the cost of ACA plans, said EASE Executive Director Tracey Schmitt Lintott.
However, EASE plans have not been supported by the Department of Labor, which oversees ERISA, and has essentially put more than 50,000 Americans at risk of losing their affordable health coverage, Lintott said. Despite seven state attorneys general issuing a letter of support in February 2019 in favor of EASE plans, the DOL issued an Advisory Opinion that Lintott has called “deeply flawed” and which preserves the status quo of Obamacare. The U.S. District Court in Texas will soon decide whether DOL or ERISA lawyers supporting EASE are correct on some technical aspects of the law.
In an interview, Lintott argued that the current environment makes the issue of preserving affordable health insurance even more pressing.
“It’s unconscionable, that even during a pandemic, bureaucrats at the Department of Labor, desperate to preserve the status quo of Obamacare, remain hellbent on blocking families from accessing affordable and accessible health care,” Lintott said. “Many of these individuals are self-employed, front-line workers who are critical to our economy during an uncertain time. We will continue to advocate on behalf of the more than 50,000 people risk of losing their EASE plans, and the millions more who could benefit from this ERISA compliant alternative to Obamacare.”
The EASE Alliance today released a YouTube video highlighting a Florida retiree and EASE participant, who implores the president to protect her health care coverage.
Meanwhile, Topher Spiro, vice president for Health Policy and a senior fellow for Economic Policy at the Center for American Progress, says the health insurance coverage crisis is something Congress must address.
Spiro, in a June column, suggests expanding Medicaid coverage to the unemployed in 2020 and 2021 and implementing a number of reforms to the program. Doing so, he said, would allow the federal government to cost-effectively cover its most vulnerable citizens during the global health crisis.
“The Center for American Progress estimates that under the plan, 23 million people would receive comprehensive coverage in 2021 at a cost of only $90 billion. Simply put, this proposal meets the scale and urgency of the current crisis.”
Shifting to this method would reduce costs for the federal government, Spiro said, because it would allow people to move from ACA coverage to Medicaid, saving more than $1,000 per person. Additionally, it would ensure coverage for more than 22 million people, he said.
“A Medicaid expansion for the unemployed would provide a seamless, automatic, and immediate transition from coverage loss to affordable coverage, with no cracks in the safety net. And in states that opt-out of the Medicaid expansion, a federal Medicaid option should be available. This strategy would guarantee immediate coverage for all of the unemployed in 2020 and 2021 at a fraction of the cost of any other proposal to cover the same number of people with comparable coverage,” he said.