How the ACA’s repeal will hurt North Carolina

This month the Trump Administration and Republican legislators begin repeal of the Patient Protection and Affordable Care Act, otherwise known as Obamacare, via budget resolution.

To anyone who watches the data on Obamacare, this is startling. Paradoxically, repealing the ACA will deliver its harshest blows to whites living in rural and small-town communities such as my hometown of Tarboro, Edgecombe County, who turned out in large numbers for Trump. New plans to privatize Medicare through a voucher system will deepen the pain.

What will happen?

First, there will be loss of private insurance and subsidies via the federal marketplace exchange. By March 2016, 545,354 moderate-income North Carolinians had purchased private health insurance there. Nearly 92 percent of them received a monthly average of $400 in Obamacare tax credits, accounting for 80 percent of their premium costs. The federal government gave North Carolinians $2.4 billion to purchase this insurance, so if repealed, the Center on Budget and Policy Priorities estimates a $3.4 billion loss in 2018, followed by $38.2 billion more between 2019 and 2028. An immediate result will be higher out-of-pocket costs, which marketplace enrollment lowered.

Second, there will be loss of benefits and subsidies through Medicaid expansion. Medicaid currently provides insurance to some 18-19 percent of all North Carolinians. In 31 other states where access to Medicaid was expanded, Medicaid is now available to poor residents who earn up to 138 percent above the federal poverty line, including adults without dependents. However, in nonexpansion states, eligibility for poor adult parents remains lower, at approximately 44 percent of the poverty level, and most adults without dependents are ineligible, period.

As a result, many North Carolinians live in a figurative and sometimes literal “dead zone”, ineligible for any insurance. Indeed, almost one tenth of all poor white adults within this “coverage gap” nationwide reside here, behind just Texas and Florida. Much research shows not having insurance gives people a lower likelihood of receiving preventive care, receiving care for chronic diseases, and having a regular provider. Conversely, it gives them a higher likelihood of postponing care, foregoing care, ending up hospitalized for avoidable health problems, getting charged more for the same medical treatment and paying more out of pocket for medical costs.

One might erroneously assume that repealing the Medicaid expansion would have little financial impact on North Carolina, since no one has been allowed to sign up for it yet. But comparing how poor North Carolinians have fared since 2010 in relation to poor residents of expansion states shows that the costs we are already paying is clear. In expansion states, fewer residents remain uninsured, federal transfer payments are higher, and state spending on uncompensated care is lower.

Third, there will be loss of benefits and subsidies through Medicare, plus rising stresses on the safety net.

Other negative costs and impacts lay down the line. Safety-net hospital systems and clinics throughout the country are already stressed. This is nowhere more the case than in rural areas like Edgecombe county where health care facilities and providers are sparse and depend critically on federal subsidies to operate, and where residents must travel long distances for care. Even worse, federal funding to help safety-net hospitals defray the cost of caring for the uninsured was greatly reduced under Obamacare, as federal officials assumed it would become increasingly unnecessary as more people became insured. No replacement exists.

If the ACA is repealed, studies project that the number of uninsured Americans will increase again. So too will demand for uncompensated care (one estimate is $1.1 trillion nationally). North Carolinians, our communities, and our state coffers will be forced to compensate, and health outcomes will worsen. Whether we liked Obamacare at its outset or not, there appear few good reasons to repeal it today.

Helen B. Marrow, an Edgecombe County native, is an associate professor of sociology and Latin American studies at Tufts University and a former Robert Wood Johnson Foundation Scholar in Health Policy.