Potential Consequences of Proposal to Further Reduce Eligibility for HUSKY-Insured Parents

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By Tribuna Staff

Connecticut budgets every two years, which means that the budget legislators passed in 2015 provides a spending plan for both this and next fiscal year. But legislators can make adjustments to the second year of the two-year budget before it takes effect.

This year, adjustments are being felt more than ever. A nonpartisan analysis has projected that, as currently written, the upcoming budget includes a deficit of more than $900 million. Legislators must find savings or additional sources of income to balance it.

These cuts or savings can affect communities in many ways – education funding, tax increases and health care.

In 2015, the State of Connecticut cut income eligibility for parents and relative caregivers of children in the HUSKY program from 201 percent of the federal poverty limit (FPL) to 155 percent of the FPL ($37,665 for a family of four), affecting nearly 18,000 parents scheduled to lose coverage on August 1, 2016.

Governor Malloy’s April 2016 revised budget proposal would reduce the HUSKY income limit further, to 138 percent of the FPL. For a family of four, that translates to an annual income of $33,534.

“Reducing income eligibility for almost 10,000 low-income parents, as the governor has proposed in his Fiscal Year 2017 budget, will happen before we know the full impact of last year’s cuts,” said Mary Alice Lee, senior policy fellow for Connecticut Voices for Children. In sum, almost 30,000 low-income families are at risk of losing access to basic health coverage as a result of the enacted and proposed changes to Medicaid eligibility.

A new report from Connecticut Voices indicates that cutting eligibility will jeopardize access to affordable insurance coverage for low-income families.

“Cutting HUSKY income eligibility for parents is a big step backward in Connecticut’s long-standing commitment to covering low-income families,” said Sharon Langer, advocacy director for Connecticut Voices. “In addition, experience in other states suggests that eligible children in affected families are at risk for losing coverage when their parents do,” she said.

Throughout the budget process last year, the state emphasized that affordable health care coverage through Access Health CT, the state’s health insurance marketplace, is available for parents who lose Medicaid coverage. However, among those who lost coverage immediately following last year’s cuts, just one in four enrolled in a qualified health plan through Access Health CT.

Most parents in this group (73.5 percent) did not enroll or have since dropped coverage and may be uninsured. Even with federal subsidies for premiums and limits on out-of-pocket costs, coverage in a qualified health plan can be very costly for low-income families. For example, a family with two parents and two children earning $48,843 could be billed as much as $13,676 (28 percent of household income) for its health coverage.

In addition, dental health insurance for adults is a separate purchase, without premium subsidies and with significant out-of-pocket costs for limited coverage.

The Connecticut Health Foundation (CT Health), the state’s largest independent health philanthropy dedicated to improving lives by changing health systems, has estimated 30-40 percent of families affected by the reduced HUSKY eligibility would end up uninsured.

CT Health has also estimated that it would cost parents $1,200 a year or about $100 a month in out of pocket expenses, which is out of reach for many low-income families. Plus, they would likely lose dental benefits and would be unlikely to purchase a standalone dental plan at an extra cost.

As of May 2, Gov. Malloy was to submit budget revisions to the legislature that would reach a compromise in which he would cut funding for the administration priority of transportation and restore some of the spending legislators have demanded for hospitals and schools. In return, he asked that lawmakers minimize their use of one-time revenues to balance spending in 2016-17.

Democrats have argued that the Democratic governor has sought to cut too deeply into funds for hospitals and for social services. The Democrats’ budget proposal that came out in the last week of April, does not propose cutting eligibility for Husky families.

The governor has said he will not support the Democrats’ budget, that budget talks were “hitting a wall” and he predicted that the regular 2016 legislative session would end at midnight on May 4, without a deal being reached.

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