If Percival, long divorced and now unemployed, lived in most of the United States, she could have turned to Medicaid after her Blue Cross Blue Shield plan disappeared along with her income. Instead, she is among 4 million people the insurance does not reach because they live in one of a dozen states that have not expanded Medicaid even as the rest of the country has been widening the health-care safety net.
But the vast coronavirus relief strategy that President Biden signed into law last week might allow Percival to stop skipping the follow-up orthopedic appointments for her ankle that she cannot afford.
Florida and the 11 other states, most of them across the South, are the intended audience for a few paragraphs deep in the 630-page American Relief Plan. The legislation offers a novel and generous financial incentive to states if they agree to open Medicaid to more poor people and some in the working class.
The White House has embraced the incentive, designed in Congress. It will pose an early test of Biden’s powers of persuasion as he tries to make good on his pledge to close the nation’s considerable gaps in insurance and health care — gaps the pandemic has thrown into vivid light.
Billions of dollars suddenly being offered to the 12 holdout states will also test how much of the opposition to widening Medicaid is truly rooted in financial arguments that many Republican state officials have consistently leveled against the idea — and how much is anchored in the raw politics and ideology that divide the nation over health care.
“You’ve taken away the argument there is even a minute cost,” said Chris Jennings, a longtime Democratic health policy consultant who worked in the White House during the Clinton and Obama years.
With a business degree, administrative jobs and steady insurance, Percival had never thought about Medicaid. Then an aunt, watching Percival unable to pay bills for the first time in her 62 years, suggested she look into it.
Percival researched online in August and learned that Florida restricts the program to parents with incomes of no more than 31 percent of the federal poverty line. Adults without children, or those with grown children such as Percival, are not eligible.
“I go back every once in a while and see whether things have changed,” she said. “I don’t see that I qualify.”
She collects $275 a week in unemployment — barely more than a third of her previous pay — as she searches for a job. She has managed to keep her house because the federal government has said that, during the pandemic, lenders can’t foreclose on people unable to make mortgage payments. She isn’t getting all the treatment she needs for migraines or sinus headaches. She knows she should be seeing the orthopedist.
Once she was allowed to start putting weight on her ankle, she went to 30 physical therapy appointments. After her insurance ended in April, she said, “it was on my dime.
“So I owe them plenty of money now. I owe everybody money,” she said. “I have all this debt.”
In the middle of it all, her refrigerator broke.
'An offer too good to refuse'
The expansion of Medicaid by three dozen states, with two more coming this summer, flows from the Affordable Care Act, the sprawling health-care law adopted 11 years ago by another Democratic Congress. The refusal by the dozen states reflects challenges to the law that Republicans began right after approval and continue to wage.
The ACA was supposed to even out a health-care patchwork that had existed since Medicaid’s origins in the 1960s as a core part of Lyndon B. Johnson’s War on Poverty. The nation’s largest public insurance program, covering more than 70 million people, is run jointly by the federal government and states, and each state always had the latitude to decide how poor someone needed to be to qualify.
As part of the 2010 law, the federal government for the first time set a national income threshold for Medicaid eligibility, more generous than in all but a few states at the time. People would qualify if they had incomes up to 138 percent of the poverty line — today, nearly $18,000 for a single person or almost $37,000 for a family of four.
The nationwide expansion was to have started in 2014. But two years before then, the Supreme Court considered the constitutionality of the law for the first of three times — including a case before it now. The majority of justices ruled in 2012 that the ACA could stand, but each state would be free to decide whether to expand Medicaid.
Since then, 32 states have passed expansion laws. Four more states — all Republican-leaning — expanded after voters approved ballot initiatives, overriding years of opposition by their governors or legislatures. Missouri and Oklahoma passed ballot initiatives last summer for expansions that begin in July.
Lingering opposition is tied to antipathy on the right toward anything associated with the ACA, the signature domestic policy accomplishment of President Barack Obama. President Donald Trump’s budget proposals repeatedly asked Congress to kill the expansion, though congressional Republicans never succeeded.
The opposition has persisted despite hundreds of studies measuring expansion’s effects that have found benefits. They include improving people’s health, narrowing racial disparities in insurance coverage and helping state economies.
In states that have not expanded Medicaid, governors and legislators have lamented having to cover a fraction of the cost. At first, the federal government shouldered the entire expense of insuring the people in a state’s Medicaid expansion group. The subsidy gradually ratcheted down to 90 percent, with states paying the rest.
Public opinion polls have shown that most Americans in non-expansion states favor broadening the program.
House and Senate Democrats in recent years have proposed incentives, mainly returning the federal contribution to 100 percent for a period of time if a state expanded. With a divided Congress and an anti-ACA president in Trump, the efforts were unsuccessful.
Resistant state officials have not changed their posture as the pandemic has ravaged employment, insurance coverage and state revenue — and as the virus has infected more than 29 million people in the United States.
“I remain adamantly opposed to Medicaid expansion in Mississippi,” that state’s governor, Tate Reeves (R), wrote in the last paragraph of his most recent budget in November. “I firmly believe that it is not good public policy to place 300,000 additional Mississippians on government-funded health care.”
Biden and the Democrats who now control Congress hope to shake that view with money.
The new law takes a different tack than previous Democratic expansion proposals. It sweetens the terms for states by adding extra federal aid — 5 percent — for each person in the original part of a state’s Medicaid program, rather than the smaller number who would be included in an expansion. The extra money would last two years from whenever a state broadened its safety net.
It would more than offset the increased cost for the state’s 10 percent share of expanding, according to an analysis by the Kaiser Family Foundation, a health policy research organization. If all 12 states expanded, the money would add up to an estimated $16.4 billion over two years — far more than the states’ share of the expansion, an estimated $6.8 billion if eligible people enrolled, the analysis found.
“Our goal in crafting this was to create an offer that was too good to refuse,” said Rep. Frank Pallone Jr. (D-N.J.), chairman of the House Energy and Commerce Committee, which came up with the idea. “The pandemic has heightened the urgent need to extend coverage to the millions of Americans who don’t have health insurance.”
Jessica Schubel, who specializes in Medicaid within the White House’s Domestic Policy Council, said the offer “gets to the heart of how the president views coverage and how important it is. This makes the great expansion deal even better.”
The White House declined to say whether administration officials have begun trying to persuade any of the dozen states.
“We obviously look forward to working with states that take the opportunity to expand,” Schubel said. “There are a lot of people that would gain from Medicaid.”
'Peace of mind'
The question now is whether holdout states will reconsider.
There are glimmers of possibility in a few of the dozen. Alabama Gov. Kay Ivey (R) “is open to the discussion, but right now, we simply do not have all the facts,” spokeswoman Gina Maiola said. “Ensuring every Alabamian has access to quality health care is important to the governor. . . . However, the problem has always been how to pay for it.”
Cortney Brown, 32, knows the difference it would make. In spring 2014, when she was living in Lynnwood, Wash., she was hospitalized for four days with a bowel obstruction related to a birth condition. Uninsured, she had not been getting checkups that could have spotted the trouble early.
On her way out of the hospital, a woman in its finance department told her she could sign up right away for Medicaid, which had just expanded in Washington state. The insurance covered Brown’s $40,000 hospital bill. It also paid for her to go to a mental health clinic to address her anxiety and dark thoughts. With talk therapy and medicine, Brown said, “I started to feel like a human being.”
When she moved to Huntsville, Ala., at the end of that year, to be close to her mother, brother and two sisters, it did not occur to her that Alabama would not offer her Medicaid.
As a massage therapist, she sometimes barters for chiropractic appointments. For her mental health, the only thing she has found is a few classes offered by a nonprofit organization. She pays for lithium orotate supplements for her anxiety. She has not been checked to see whether she is at risk for another bowel obstruction.
Apart from the past year, when the pandemic stole many of her clients, she figures she could afford to pay $100 a month toward a health plan. The cheapest she found was close — $130 a month — but it came with a $7,000 deductible.
“Whose bright idea was that?” she said.
The Congressional Budget Office predicts that, with the new law’s incentive, the proportion of potentially eligible Americans on expanded Medicaid will rise from 60 percent to perhaps 70 percent by the end of the decade. The CBO, in other words, does not expect every state to take the offer.
Three more states — Florida, Mississippi and South Dakota — allow residents to collect signatures to place voter initiatives on state ballots. Advocates of expansion are starting efforts in all three, with none expected before 2022.
In Mississippi, the state hospital association is trying to counter Reeves’s adamant opposition. For the third year, it has proposed an arrangement in which its approximately 115 member hospitals would pay most of the state’s expansion costs, reasoning that it would be much less expensive than absorbing the bills of uninsured patients.
“It wouldn’t cost the state a dime,” said Timothy H. Moore, the association’s president. The idea came up twice last month in the state House of Representatives. Every Republican voted no, and it died.
Florida is considered the toughest place to get an initiative on the ballot, after a signature-gathering campaign last year prompted the legislature to stiffen the requirements. Asked whether Gov. Ron DeSantis (R) might consider the new incentive, a spokeswoman replied: “The governor remains opposed to the expansion of Medicaid in Florida.”
The governor’s view means that in Orlando, Michael Smith will keep taking buses every day, nearly two hours each way, to get methadone at New Season, a drug-treatment center. Methadone and counseling have weaned him from opioids he was prescribed for pain after he was doing some work for a landscaper and fell 30 feet from a tree onto a log, injuring his back.
If he was on Medicaid, Smith, 33, figures it would pay for him to get a 15-mile ride to New Season and probably for a once-a-week treatment.
As it is, he works as a handyman and scours apartment complex dumpsters for good throwaways that he sells on Facebook Marketplace. A lampshade. A coffee table. Occasionally, a real treasure such as the foot-tall, wooden Pinocchio that he found in its original 1964 Walt Disney box.
He can’t afford to pay retail for the inhalers he needs for asthma that wakes him, wheezing, at night. So he posts on Facebook, asking whether anyone has inhalers they will sell for cheap.
Because of DeSantis’s stance, Percival, in debt for the first time in her life, will at least for now keep telling creditors that she will make payments “as soon as I get grounded again.”
Her path to this place began with a vacation.
She had saved money and time off for a five-day trip to Jamaica to start last year. The first full day, she and a friend booked a catamaran ride and went snorkeling, with a late-afternoon stop at Rick’s Cafe in Negril for a sunset view. She was on the dance floor when a woman from the catamaran beckoned her outside. She was clambering down steep, stony steps when she slipped. Immediately, she knew her ankle was shattered, her foot dangling at a sickening angle.
She was in surgery a day later back home.
“These small things that can happen to anyone at any time can break you,” she said. “You’ve worked so hard, and all of a sudden you are at the risk of losing everything. It’s a nightmare to live with your fear.
“If the state had an option, I could take advantage and go back to the orthopedist,” she said. “It would just give me peace of mind.”