Study says Obama health plan increases access, affordability in California

President Obama’s newest health reform proposal expands access to coverage and affordability for many low- and middle-income Californians by creating a new health insurance exchange and expanding Medicaid, according to a new study by UC Berkeley’s Center for Labor Research and Education.

The study, jointly released with the National Opinion Research Center at the University of Chicago and the global professional services firm Towers Watson, estimates the number of Californians who may benefit from expanded coverage under the White House proposal unveiled on Monday (Feb. 22).

It also estimates how much the average Californian without employer-based coverage would spend on premiums and out-of-pocket costs under the proposal — and compares that with coverage purchased in the state’s existing individual market.

The report, “The President’s Health Reform Proposals: Impact on Access and Affordability in California,” is available on the UC Labor Center Web site at www.laborcenter.berkeley.edu/. Authors include Labor Center chair Ken Jacobs and economic researchers Laurel Tan, Dave Graham-Squire, Jon Gabel, and Roland McDevitt.

They report that the White House plan would expand Medicaid eligibility at the same level as passed by the U.S. Senate and provide increased tax credits for low- and middle-income families to buy coverage through the exchange.

Key study findings include:

  • Close to 4 million Californians who were uninsured, in the individual market or who had unaffordable employer-sponsored insurance in 2007 would qualify for Medicaid or subsidized coverage in the exchange
  • Californians earning $14,404 a year would save $5,159 on average on premiums and out-of-pocket costs under the proposal compared to what they would spend in the current individual market. Those earning $43,320 a year would save $904 a year under the proposal

“Those who don’t qualify for the subsidies will still benefit from the reforms requiring insurers to cover all applicants, without regard to pre-existing conditions,” said Jacobs.

The White House proposal will be discussed at a bipartisan meeting on health reform in Washington, D.C., tomorrow (Thursday, Feb. 25).