The Stimulus Bill:
What Does It Do for Health Care?
The American Recovery and Reinvestment Act, signed into law by President Obama on February 17 2009, included $87 billion to shore up state Medicaid programs. It also provided subsidies to unemployed workers to help them pay the premium to stay in their former employer's health plan (COBRA coverage). These were significant victories, and we applaud them. But we suffered some setbacks along the way—the COBRA subsidy was available for only nine months, for example, and the temporary Medicaid option to provide health care to low-income unemployed workers was dropped. We have much more to do. Still, this was an exciting first step.
Below we describe more of the health care provisions from the American Recovery and Reinvestment Act:
- Provided a subsidy to help unemployed workers purchase their employer's COBRA coverage. The 65 percent subsidy was available for up to nine months for workers who lost their jobs between September 1, 2008, and December 31, 2009, and whose income does not exceed $125,000 for individuals and $250,000 for families. People who lost jobs at small firms and who receive state continuation benefits (sometimes called "mini-COBRA") are also eligible for the subsidy. For more information, see Understanding COBRA and Mini-COBRA Premium Assistance and States Act to Help People Laid Off from Small Firms: More Needs to Be Done.
- Increased federal dollars for state Medicaid programs by $87 billion until the end of 2010 to support this crucial safety net program amidst rising demands. Some states that are burdened by particularly high rates of unemployment received extra federal support. States were not be able to change their Medicaid eligibility requirements while receiving the enhanced federal matching dollars. More information l FAQs l Summary of CMS Guidance
- Encouraged the use of electronic medical records, including the collection of data on race, ethnicity, primary language, and gender, health information technology (HIT), and comparative effectiveness guidelines in order to promote system-wide efficiency and more effective clinical treatment.
- Extended Transitional Medical Assistance (TMA), a program that allows families to maintain Medicaid coverage temporarily when they start a new job and earn income that would otherwise render them ineligible. TMA prevents families from being penalized for working.
- Continued the Qualified Individual (QI) program, which helps low-income seniors and disabled Americans pay their monthly Medicare premium.
Families USA: Making the Case for Strong Health Coverage Provisions in the Stimulus Bill
The American Recovery and Reinvestment Act: House Bill Health Coverage Provisions for the Unemployed Are Essential describes key differences in the health coverage provisions in the Senate and House versions of the economic recovery package, namely temporary Medicaid for unemployed workers and COBRA subsidies, and explains why the House provisions are crucial for helping unemployed workers and their families keep health coverage. (February 2009)
Unemployed and Uninsured in America analyzes the health coverage status of unemployed workers with low and moderate incomes, including national and state-level data. (February 2009)
Critical Care: The Economic Recovery Package and Medicaid Many states have enacted or are proposing cuts to Medicaid and CHIP. This report examines those cuts and provides state-level estimates of the economic impact of the temporary increase in federal Medicaid funding proposed in the President's stimulus package. (January 2009)
Squeezed! Caught between Unemployment Benefits and Health Care Costs examines COBRA coverage and unemployment benefits and finds that, to maintain their employer-based coverage under COBRA, most unemployed workers would have to devote an unrealistically high proportion of their unemployment check to health insurance. | Press Release (January 2009)
A Painful Recession: States Cut Health Care Safety Net Programs One impact of the current recession is state cuts in Medicaid and CHIP. The report examines that impact and also shows, on a state-by-state basis, how temporarily increasing federal funding for Medicaid can stimulate state economies. | Press Release (December 2008)
