Nearly one-fourth of the people subject to a new Medicaid work requirement in Arkansas lost their coverage in the first year of implementation. This despite the fact that more than 95% of the target population in the state appear either to meet the work requirement or to qualify for an exemption. These people aren’t finding work and obtaining new insurance; they are simply becoming uninsured. According to a new study in the New England Journal of Medicine, Medicaid enrollment for working-age Arkansans is down, the uninsured rate is up and there has not been a noticeable effect on employment. The study also appears to confirm what many Medicaid advocates feared: People are losing coverage as a result of confusion about the policy, rather than failing to meet the work requirements. Vox’s Dylan Scott reports:
The uninsured rate for the same population increased from 10.5 percent in 2016 to 14.5 percent in 2018. Employment declined among this group over the same time frame, from 42.4 percent to 38.9 percent, though that was true for all cohorts. But for Medicaid coverage and the uninsured rate, the population targeted by Arkansas’ work requirement saw significantly more deterioration than other age groups and people in other states. The Harvard survey found that one-third of respondents in the age 30-49 range had not heard anything about Arkansas’s new work requirements for Medicaid. Nearly half of those people, 44 percent, said they were unsure whether the requirements applied to them. A significant number of people said a lack of internet access (32 percent) had contributed to their decision not to report their relevant information to the state.
Smarter senior tax breaks
While the cost of tax breaks for seniors are rising, the benefits of those breaks increasingly go to those who need them least and reinforce racial inequality, according to a new report from the Center on Budget and Policy Priorities. Senior tax breaks caused Louisiana to forgo an estimated 7.2% ($240 million) of income tax revenue in 2017. Higher-income seniors with pensions, annuities, or other retirement savings benefit the most from state tax breaks for retirement account income. However, people of color are less likely to be covered by a defined benefit pension plan, to have retirement savings, or to have wealth and other assets. As a result, they benefit less from Louisiana’s age-based tax exemptions on retirement income and homes and other types of tax breaks. Louisiana partially exempts private retirement income from taxation and fully exempts Social Security benefits from the income tax, regardless of need. Elizabeth McNichol outlines ways to target senior tax breaks to those who need them most, including reworking Social Security benefits and expanding the Earned Income Tax Credit.
More states could tax a portion of Social Security benefits when the recipient’s total income exceeds a specified amount — as the federal government does — rather than completely exempting such income from taxation. Six states use the same income limits as the federal government for determining whether to tax Social Security benefits, and another seven states partially tax such income using different income limits. Other states should follow suit. … States could replace these tax exemptions for seniors with an expanded state Earned Income Tax Credit (EITC) for seniors. State EITCs offer additional credits on top of the federal EITC, which helps people working in low-wage jobs meet basic needs. Currently workers aged 65 and older are not eligible. Eliminating this age limit would benefit low- and moderate-income seniors who must work after age 65. States could also develop a similar means-tested credit targeted specifically to low-income seniors. Making a state’s tax system less upside-down would also benefit low-income seniors.
Fuzzy math won’t reduce poverty
In a move that will almost certainly cut benefit access for working people, the Trump administration is looking to change how the poverty threshold is determined. Currently the government adjusts the measure for inflation via the Consumer Price Index for All Urban Consumers (CPI-U). But the administration is considering using other inflation measures instead, particularly a statistic called “chained CPI” which rises more slowly than CPI-U. The American Prospect’s Kalena Thomhave, a former LBP intern, explains why this new measure simply doesn’t apply to real people:
Many economists claim that chained CPI’s full recognition of substitution makes this measure more accurate. But chained CPI only works well for economists, who think of people as abstract “rational consumers”—widgets in a theory class. When real people come into the equation—specifically low-income people, seniors on fixed incomes, the homeless, and people with disabilities—things get tricky. A person who receives SNAP has a limited food budget, and for them, the price of all food might be too high. In addition, chained CPI might not be as accurate for populations who cannot substitute, because they spend most of their income on necessities without comparable substitutes—medicine, transportation, housing. As Nancy Altman, president of Social Security Works, asks, “What do you substitute if your insulin is too expensive?”
Why is Illinois losing residents?
People are leaving Illinois in droves, and Republicans and Democrats are blaming each other for the exodus. Illinois lost 157,000 residents over the last half decade, making it one of only two states (West Virginia is the other) to see a decrease in population over the last 10 years. A new brief from Pew Charitable Trusts examines how the loss of manufacturing jobs, the high number of college students who go out of state to pursue higher education and never come back and a lack of opportunities for people of color contribute to the disturbing trend.
“There’s something wrong here,” said Jawanza Malone, executive director of the Kenwood Oakland Community Organization, a South Side grassroots group currently leading a rent control campaign “to stem the tide of displacement.” Chicago is among a handful of metropolises that are losing their black residents, including Los Angeles, San Diego and San Jose. The high rate of black residents leaving is the main cause for Chicago’s stagnant population, and the drain could get worse, several fair housing advocates and urban demographers said. More than a third of young adults want to leave Chicago, a January survey from the University of Chicago’s GenForward Project found. Participants, especially African Americans, said the biggest reason for wanting out was racism and how that affects policing, job opportunities and neighborhood development. Chicago’s new African American mayor, Lori Lightfoot, seems keenly aware of this challenge, calling it “the proverbial canary in the mine shaft” when asked in April about the city’s population decline by the Chicago Tribune. “We’ve got to create real opportunities and incentives for businesses and for all neighborhoods to prosper,” she added.
Number of the Day
20,000 – Number of people who lost their Medicaid health coverage in Arkansas after the state implemented work requirements that have since been blocked by a federal judge, who deemed them “arbitrary and capricious.” (Source: Vox)