Do You Have To Take Medicaid If You Don’t Want It?

Medicaid with ObamacareIt’s been a little while since we talked about the Affordable Care Act or Obamacare. Love it or hate it, you are supposed to be signed up for some sort of health care coverage by March 31st. Many states have expanded their Medicaid programs so that a larger number of people are eligible. One big issue I have with the whole Healthcare.gov system is that you have to take Medicaid if your income falls into that bracket, even if you don’t want it.  This is a long post, but I have tons to say about this topic, so get a snack or beverage if you need to.

What Is Medicaid?

Medicaid is a social program for low income families and individuals who have limited income and resources. It is jointly funded by the state and federal government, but each state has to decided whether or not to participate. Every state has some sort of Medicaid program presently. Medicaid is not like Medicare, which covers senior citizens and is partially funded by your payroll deductions over the years.

In the past, children and pregnant women whose income was below 133% of the poverty limit qualified for Medicaid. Also if you were disabled or had other special circumstances, you could qualify. For everyone else, Medicaid eligibility used to take assets as well as income into account, so it wasn’t possible to qualify for Medicaid if you had a high net worth.

Medicaid For All With Obamacare

Obamacare expanded Medicaid so that anyone whose income meets the 133% of the poverty level qualifies for Medicaid. Not every state has adopted the Medicaid expansion, but many, including my home state of Colorado,  have.  In Medicaid expansion states, you likely qualify if you make $16,104 as a single or $32,913 as a family of 4.

If you are enrolled in Medicaid, your basic medical costs are pretty much zero. There are no premiums. You might have a very small copay for certain services, but it’s usually no more than $5. Medicaid offers prescription drug coverage, but you have to choose from drugs on their approved list. I see no rhyme or reason to their list at least with eye medicines. Some of the more expensive drugs are covered while cheaper ones might not be. Medicaid covers most services for kids, but adults usually do not have coverage for things like routine dental or vision. However if there is something medically wrong, if a patient has chronic conditions, or needs maternity care, it is usually covered by Medicaid.

What Is The Problem With Medicaid?

Free health care sounds great, right? Yes and no. For truly poor or disabled people Medicaid is a life saver. Without Medicaid in the United States, you’d see many individuals going without basic health or pre-natal care only to show up at the emergency room in dire straits, which raises heath care costs for all of us. While even Medicaid covered persons do not always seek timely treatment, you can’t argue that Medicaid allows much greater access to vital health care than if the program didn’t exist.

However, from a provider standpoint, Medicaid reimbursements to doctors and hospitals are generally a very small percentage of normal fees. Yes, normal fees are usually outrageous, but Medicaid payments often do not cover the operating cost of a facility. With eye care, Medicaid pays about $20 for an eye exam that would normally cost $100. If we did Medicaid exams all day, we couldn’t afford to pay staff or keep the electricity running.

Added to that fact is the reality that Medicaid patients are the least reliable of any patient demographic, at least in our office. I’m not sure if this is due to poverty that affects transportation, inability to take off work, not having a working phone to call and cancel in advance, or something else. With my work for the Public Health Service over the years, it also seems that having free access to care lowers the value in a patient’s mind. Regardless, Medicaid patients have more than double the rate of no-show appointment than non-Medicaid patients.

As a result, many providers are declining Medicaid patients altogether or strictly limiting the number of them that can be seen. We limit non-emergency Medicaid to one per day in an unpopular time slot. If we get cancellations, we can take more, but we don’t actively schedule them. That may sound harsh, and I sometimes question it myself, but there is nothing worse for a doctor’s bottom line than having a no-show.

If patients have Medicaid but can’t get an appointment with their doctor, that sends people right back into the emergency room, which kind of defeats the whole purpose.

Why Basing Medicaid Solely on Income Is Wrong

Basing Medicaid eligibility on income alone is not a good idea in my opinion. For one, it encourages people to work less so that they can qualify. I recently talked to a patient who worked at a fast food restaurant. He has been a maintenance person there for years and is pretty talented at fixing mechanical equipment. He actually loves his job and wants to work full time, but he has a few chronic health conditions. He ended up cutting his hours so he could qualify for Medicaid. With his regular salary, he still couldn’t afford normal coverage, even with a subsidy, so he now works less to get Medicaid. I know a mantra of the PF community is to work smarter not harder, but this just seems wrong to me on so many levels.

Medicaid bases your eligibility on mean adjusted gross income alone. If you are really smart with your tax strategy and have no debt and low expenses, you could easily have millions socked away in various accounts, have a fully paid for home, and still structure your income to qualify for Medicaid. I realize Fox News hates Obamacare, but I thought this story was pretty compelling. Basically, a couple who have made a fortune and don’t currently work who  live in a $5 million dollar paid for house have qualified for Medicaid.

On Healthcare.gov, if your adjusted income qualifies for Medicaid, you have to take it. You cannot opt out. I have no problem with the government offering a subsidy to help pay for an insurance policy, but you can’t get one if your income qualifies you for Medicaid. Your option is to take Medicaid or pay full price off the exchange. Unlike ambulance chasers or people who purposely work the system, you literally  have no other option if you want to follow the Obamacare laws and not spend a fortune on private insurance. You can stick it to the government and take their free health care while laughing every month as your net worth grows.

When we do end up with no debt and can live on very low expenses, I’m not so sure I’d take advantage of Medicaid, even if we qualified. I’d have a real problem with the stigma of being on government assistance when I knew I could afford more. Also, being on Medicaid would probably limit my care because of the reasons mentioned above. Hopefully, this loophole in the system will be fixed or at least the option to decline Medicaid will become available.

Would you take Medicaid if you had a high net worth but low MAGI? Do you think there is a stigma attached to people on Medicaid? Is that deserved or not? 

Image: Freedigitalphotos.com/cooldesigns

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Written By
Sydney White is a Texas-born stay at home mom who enjoys spending time with her family, bargain hunting and, of course, writing. She is currently the editor-in-chief of Snipon.com.

46 Comments

  1. I worked at my previous job for nearly 9 years and current one (with no time off in between) for 3 years. Sadly my last job purged seniority and I lost my job just as this awful insurance mess started. talk about the worst timing ever! I currently was going through a relapse I have Multiple Sclerosis, Fibromylgia and many other medical conditions. I have worked all my life when young It was easier however the older you get the harder it is for body to bounce back. I had been battling medical issues for many years. after many years of working with my doctor we finally found the correct medication amount and types that personally worked for me. I was able to keep pain levels to a tolerable level and finally was able to manage my fatigue so that I could keep working and not go on disability I wanted to work as long a I could while I could. Unfortunately, I fell in loop hole never dreamed I was going to be forced on Medicaid due to not having income for the first time in years I did not want to go on disability yet. after the initial shock and depression anyone goes through after losing everything so unexpectedly let alone the time it takes to change so many things that were entwined around that job and that income. yes medicaid pays for visits however they took away all medications that worked so I called drug companies and they offered me patient assistance when i mentioned to doctor I could use that or use my savings and get family help to get back what worked so that I could I was told I was not allowed and medicaid only covers name brand medications and not the type that work for me. they wont even cover the M.S meds. so the doctor wont right a script since medicaid wont cover it. sadly I had not choice to file for ssdi but still stuck on this awful medicaid until medicare kicks in if I don’t die or relapse permanently first.
    If left alone and if I was able to not have govt take away my lively hood I could have probably worked many more years instead I am bedridden and depressed. never dreamed I was see anything so unethical in my lifetime. sadly to I don’t believe anyone knows what the word individualism means anymore. I don’t want Medicaid never wanted it ever. I cant believe they cry about not able afford it but then force me to use it when they are told I am able to pay bureaucrats and mindless.

  2. If you are being forced into Medicaid because you earn less than 100% (or138% in some states) of FPL, you can transfer $ from an IRA to a Roth IRA and use the taxable income generated to move your taxable income to 101% (or 139%) of the FPL. Then you can get a large subsidy for your healthcare under the ACA. This strategy will keep you out of the Medicare nightmare!!!

  3. Because of disability, my wife and I both had to go on Social Security disability and thus have Medicare. We chose to go with a Kaiser Permanente administered Medicare plan. Because of our income, we keep getting signed up for Colorado Medicaid against our will, and we have no need for it since we’re on Medicare.. The following pattern occurs: We receive letters from CO DHS that we’re Medicaid eligible. Then we get letters that if we want to keep Medicaid (we don’t) we have to pay a monthly premium to stay with Medicaid. Launder, rinse, repeat.

    Meanwhile because we’re Medicaid eligible, specialists that accept Kaiser Medicare won’t take us because we’re also on Medicaid.

    Amendment 69 is no panacea. What we need is a less complex way of paying for health care. A thousand different varieties of employer sponsored health care, plus the layers of government sponsored health care has turned things into a total mess. Employees don’t really get to choose beyond maybe a couple of employer sponsored plans, medicare eligible have a few more choices but not much. No one knows the true costs of the actual medical service. We squeeze the balloon to cut costs in one area, only yo find the blowing out the other side of the balloon.

    In short I understand the dilemma providers face.

    It is time for employer sponsored health care to end. It came about after WWII as a way to provide benefits to employees in lieu of pay raises that couldn’t be granted because of price controls in place at the time. We need a system for paying for health care that has everyone on a level playing field. To me, our choice is either based on 1. Medical Savings Accounts with substantial deductibles where people self-insure for minor procedures (over-simplified for lack of space) or 2. Socialized medicine as in Canada and most of Europe…I’m leery of that choice.

  4. The problem I have with Medicaid is its not really free anyways – its a loan, and now not only can they take a person’s home, but any assets or assets they transferred to family when they die to repay their medical bills. With the new laws where I live in Ohio they stand to make 4 times as much money as before from estate recovery. The reason I don’t think this is right is because many people being forced onto medicaid because they fall into an income gap are older widows who now earn little money but their homes may be paid off from their husbands working many years and they want to leave the home to family. Health charges are way too high and Medicaid can pay premiums to private insurers that are too high and expect to recoup it when they grab the patient’s property. The person if buying on their own might not buy such high premiums. The insurance rates on the exchange are too high for most people, with ridiculous deductibles, and then the whole system also focuses on “staying healthy” using traditional care, pharmaceuticals with their dangerous side effects, chemo, etc. There is little accommodation or encouragement to pursue natural health options which is a growing trend and truly helps people get well. Our country has been rated the worst in state of health of all 20 “advanced” nations globally. In the Journal of American Medicine’s annual report well over a million people in the US die each year due to this type of medicine (errors, medication side effects, interactions, unnecessary surgeries, etc) and these are only deaths that occur in the hospital, not after they leave. So do I want to be forced to buy insurance for healthcare I don’t believe in? This is why I personally have joined one of the independent Christian co-ops that is affordable and is exempt from the Obamacare rule. I use natural medicine, I would be willing to pay for just emergencies/urgent care or ER but there is no option for that, and the decisions made regarding health insurance and Medicaid ultimately benefit the medical community who are getting paid more by people being forced onto plans, the states are collecting more, insurance companies are raking in more, and the demographic that had pre-existing conditions who are mostly older from a certain constituency can get care, but there is no limit on what insurance companies can charge. It is all about profit not getting healthcare. While a huge number of children/family of the people who are middle class or poor will pay the price when assets left for them are taken away that they need (home, life insurance, pensions, etc – any assets) while the person will probably not even get well with our current medical practices and the pharmaceutical companies, insurance companies, and doctors get richer. My sister is a doctor and since Obamacare went in (which she complained about constantly before it did because she thought she would be getting paid less due to Medicaid enrollments) and now she is making record profits.

  5. I am presently on SSDI and have medicare and medicaid. I recently received an inheritance which puts me over the resource maximum limit to qualify for medicaid. I can spend it down to qualify again but I would rather pay for a medigap plan and get the extra help for a prescription plan but not sure if I can do this. I have called both the SS office and Medicare office and neither seem to know if I can which I don’t understand why they don’t know. I haven’t heard from medicaid yet since notifying them of the inheritance and am in need of dire medical care but don’t want to go because I will not be able to afford the 20% that Medicare doesn’t pay. I’m not sure how to proceed to get the answers I need but I will keep trying.

  6. My situation is the same as Jen M – I left my job to return to graduate school – so I qualify for Medi-Cal – which I don’t feel I should be entitled too. I saved money so I could return to school and support myself. It’s either free or several thousand dollars per year – but since my income is “$0” I just get routed to Medical. All doctors I’ve seen are far away in sketchy neighborhoods and I waited at least two hours for all three appointments (general check-up stuff) – 3rd appointment they told me to leave after two hours because they didn’t have authorizations from my primary – and clerk was off that day. I need various vaccines due to being spleenless – can’t find anyone to give it to me. Local CVS, Walgreens etc advised they would be commiting insurance fraud if they gave me the meningitis vaccine I had been prescribed. These doctors WONT TAKE YOU even if you want to self-pay – so your suggestion to do just that is not feasible. Lots of kinks to work out – but if I choose to spend my savings on insurance premiums that allow me to see a convenient doctor, I should be able to set my priorities that way.

  7. 86% of people who get their healthcare via Obamacare get a subsidy. A family of four is subsidize up to an income of $95,000 a year. This is ridiculous. I am single with three kids and I do not expect my fellow taxpayers to pay for my health insurance. Yet I see healthy married couples with assets and only one or two children get very low-cost health care at the expense of tax payers. It’s ridiculous. The government should only pay for your health care if you literally are unable to. If you’re living a middle-class lifestyle, please don’t ask me to pay for your health insurance. If you have assets, please don’t ask me to pay your bills! The irony of it is that people don’t realize this is basically welfare.

  8. I see the original article was posted over a year ago but I just came across it. I’m one of those people that qualifies for MediCal since I’m now unemployed, but I don’t want MediCal because I want to keep my doctors. In addition, per the MediCal documents I received when I was told I qualified for MediCal, there are no doctors that accept MediCal near me. However, I was told I can’t decline MediCal, so I am technically still on MediCal but I also pay full price for non-MediCal insurance through Blue Shield. Of course, Blue Shield takes my monthly premium, so I have not had push back from them.

    My interpretation of the law is that I won’t get government subsidies for my Blue Shield insurance since I qualify for MediCal, but I have not found anywhere that it states I can’t purchase full price insurance even though I qualify for MedCal. I did purchase my Blue Shield insurance through the exchange, though, just in case I do get income before the year ends, which would then put me in the category above MediCal qualification where I could take advantage of the gov’t subsidies….at least, I think I did. 🙂

    As someone stated earlier, though, if I don’t have any emergencies this year, it would have been cheaper for me to just pay the full charges from my doctors rather than the Blue Shield premium. The premium will end up costing me $3,600 for the year, whereas, my medical bills so far this year would have been $114 (I don’t go to the doctor often).

    1. That is a tough one. I think in your case, I would drop Blue Shield, keep MediCal for emergencies and pay out of pocket for routine doctor visits. You might even be able to get a cash discount. It’s sad you can’t choose to purchase insurance and take a subsidy if you don’t want Medicaid.

  9. I’m going through this nightmare right now. I really really really wanted to stay with my current psychiatrist even if it means paying out of pocket (still way cheaper to pay out of pocket every couple of months than to pay monthly insurance premiums that I can’t afford) but I’ve just been informed since they found out I have medicaid they’re not allowed to let me pay them. That’s right. I’m not allowed to see my psychiatrist or therapist for treatment for depression.

    1. If they are not a Medicaid provider, I believe you can choose to pay and see them. If they are a provider, then they can’t charge you and can limit when and if they take Medicaid patients. I’m so sorry you have to deal with all that.

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