Medicaid expansion could leave some with marketplace coverage in the lurch

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    Pennsylvania’s Medicaid expansion means that more than half a million residents are newly eligible for the coverage. But an unlikely group may be falling through the cracks — the tens of thousands of low-income adults who signed up for marketplace coverage last year before this Medicaid option existed.

    While neighboring states expanded Medicaid up to 138 percent of the federal poverty level, Pennsylvanians with incomes between about $11,000 and $16,000 a year (or between 100 percent and 138 percent of the federal poverty level) qualified for discounted marketplace coverage through healthcare.gov last year.

    Under federal rules, those individuals no longer qualify for discounts because, since Jan. 1, they’re  eligible for a lower-cost Medicaid option under Pennsylvania’s new expansion.

    Those who update or change their plan will get a notice from the marketplace warning them about this and that they may now qualify for Medicaid.

    But Ann Bacharach, with the Pennsylvania Health Law Project, worries many won’t know to switch.

    “The challenge is the marketplace will not automatically notify everyone who is in this cohort of folks,” she said. “If they auto-enroll and don’t update their information, the marketplace will not be able to screen them for Medicaid and send them over.”

    Those who unwittingly continue drawing down discounts for their old coverage could wind up owing money during tax time next year.

    “Now there’s a maximum amount that families below 200 percent of the poverty level might have to pay back, but that’s $300 for a single person and $600 for a family,” said Bacharach. “That’s a lot of money for people at the low end of the income scale.”

    Others worry that those who decide to drop their marketplace plan altogether because of cost increases this year may not realize they can now sign up for Medicaid.

    The state recently sent letters to about 140,000 households that might be affected (below).

    Officials advise anyone in this situation to apply for Medicaid and get enrollment confirmation before going back and canceling marketplace coverage.

    The deadline to change or sign up for marketplace coverage is Feb. 15.

    People can sign up for Medicaid at any time.

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    Final Letter to FFM Benes (PDF)

    Final Letter to FFM Benes (Text)

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