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Topics: Obamacare

Obamacare forces grandkids to pay for aging Boomers' health insurance

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Opinion,Op-Eds,Obamacare

Millions of Americans were shocked as 2013 ended with an array of little-known and underreported facts about the Affordable Care Act. Unfortunately, it appears that 2014 will hold more of the same.

The latest twist gives new meaning to the notion of intergenerational theft. Baby boomers signing up for “free” Obamacare coverage today may burden their heirs with paying for it tomorrow.

The problem lies in a 1993 federal law regarding estate recovery. States must attempt to take the assets that pass through probate of those deceased individuals 55 and older who received certain Medicaid benefits if the individuals were unmarried and had able-bodied children over 21 years old.

This is essentially back payment for the cost of coverage from when the recipient was alive. This trade off is not widely publicized.

It is a classic “fine print” trick that often results in survivors losing all the deceased’s remaining assets, which can be an unexpected and painful blow to grieving families.

Consider this in the context of the highly touted Medicaid expansion, which extends coverage to large swaths of the population.

The structure of Obamacare puts heavy financial pressure on individuals with income less than 138 percent of the federal poverty line to enroll in Medicaid -- unless they want to pay the higher, unsubsidized costs of the comprehensive plans on the federal or state exchanges.

This is especially harsh for the population Medicaid covers. Though an individual’s income may be low, his or her assets might include the family home and a car or two.

Since Medicaid expansion increases eligibility to higher income levels, there are more people who will be vulnerable to state governments’ reaches.

As each day passes, “the law of unintended consequences” is looking less like an idiom and more like another name for the Affordable Care Act.

Here’s a scenario that could easily play out: Mary, a 58-year-old woman working at a part-time job, has already paid off her mortgage and her car payments.

But due to her limited income, she qualifies for Medicaid. If she requires long-term care, Mary and Sue, her 23-year-old daughter, will not have to worry about the cost of care today — but at what later cost?

Upon the Mary’s death, her daughter may have to forfeit that house and car to pay for the care her mother received. In almost half the states, her daughter may even have to surrender payouts from a life insurance policy.

Government seizure of assets of dead Medicaid recipients highlights both the hardships faced by the survivors of Medicaid enrollees and the fact that Medicaid costs a lot of money.

Estate-recovery mandates are in place because the cost of Medicaid is so out of control that the federal government has forced the hand of states to get something back in the long run.

It is the clearest sign that government cannot afford to provide the health insurance that it claims it does.

Despite these shortcomings in the current Medicaid system, half the states and the District of Columbia have decided to expand Medicaid in its current form.

They are doing that rather than addressing rising costs and subpar health care. State leaders have determined that a promise of more money is more important than getting the system right.

State leaders who opted to expand Medicaid will be billing the families of the deceased for mediocre care, all while claiming the moral high ground.

Instead of focusing on how to grab more federal dollars and feign compassion, states should consider alternative solutions to deliver quality health care and not empty the pockets of taxpayers.

Bob Williams, a former Washington state legislator, is president of State Budget Solutions.
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