Nearly 2 million adults and children could be left uninsured by an "odd and particularly problematic side-effect" of Obamacare known as the "family glitch" — and another 2.28 million children may feel the squeeze next year if Congress doesn't renew the Children's Health Insurance Program, a new report warns.
The
American Action Forum report explains the glitch occurs when one or both spouses in a family are offered affordable individual employee-sponsored insurance, but family coverage is either not offered or is unaffordable.
The glitch, the conservative think tank points out, "is an odd and particularly problematic side-effect of the Affordable Care Act," adding: "Since several provisions of the law are rather ambiguous, they unfortunately combine to create a perfect storm where obtaining affordable health insurance is practically impossible."
According to the think tank report, up to 947,000 spouses and 984,000 children could be left uninsured "by this conundrum."
"An additional 2.28 million children could fall into this glitch when the Children’s Health Insurance Program funding expires or if it is altered," it warned.
The $13 billion a year children's health insurance program covers about 8.1 million children nationwide — and will begin to run dry in October 2015 unless it's reauthorized,
The Hill reports.
The Hill reports health policy analysts who advise Congress on insurance for low-income families met Friday to discuss the money crunch — the Senate's first hearing this year on the Children's Health Insurance Program funding.
The think tank report explained Obamacare allows anyone below 138 percent of the poverty line to be eligible for Medicaid, and anyone up to 400 percent of the poverty level eligible to also get subsidies to help pay for insurance purchased through the health exchange.
But the provision doesn't apply to families offered employer-sponsored insurance, even if it is only offered to an individual worker.
"This provision of the law lacks clarity on the point of whether or not the coverage offered must be family coverage, or whether individual coverage is sufficient," the think tank report said.
"The Internal Revenue Service … through rule making, has interpreted the statute as only requiring an employer to offer individual coverage, and pegged affordability at 9.5 percent of the employee’s household income. The glitch occurs when one (or both) spouses are offered affordable individual [employer-sponsored insurance] under the IRS definition, but family coverage is either not offered or is unaffordable."
The glitch is "just one of many problems that will inevitably arise from the ACA's complete restructuring of the health care system," the American Action Forum report concluded.
"It is an unintended consequence that creates hardship and perverse incentives for American families struggling to obtain affordable health insurance."
Authorities have been warning about the "family glitch" error for years, according to some analysts.
"We saw this 2½ years ago and thought, 'Has anyone else noticed this?'" Kosali Simon, a professor of public affairs at Indiana University who specializes in health economics,
said in 2013. "Everyone said, 'No, no. You must be wrong.' But we weren't, and that's going to leave a lot of people out."