What is the coverage gap?

coverage gapAnswer:  The predicament of 13,000 South Dakotans whose income is too low to purchase subsidized insurance on the exchange and too high for current Medicaid coverage.

Background:

About 13,000 South Dakota residents have fallen into the coverage gap. This means their incomes are too low to qualify for tax credits through HealthCare.gov and too high to qualify for Medicaid. They are stuck in the middle with no affordable insurance options unless the South Dakota Legislature decides to accept the federal tax dollars that were set aside to help uninsured families in South Dakota afford coverage[i].

The cost of insurance for these individuals or families ranges from 31% of before payroll-tax income to over 100% of income, depending on their age and number of adults in the household.[ii]

Table 1 - Percentage of income that is needed to purchase insurance in coverage gap in South Dakota

Table 1 – Percentage of income that is needed to purchase insurance in coverage gap in South Dakota

 

 

 

 

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[i] The Coverage Gap: Uninsured Poor Adults in States that Do Not Expand Medicaid – An Update Jan 21, 2016.Rachel Garfield and Anthony Damico. Retrieved from http://kff.org/report-section/the-coverage-gap-uninsured-poor-adults-in-states-that-do-not-expand-medicaid-january-2016-issue-brief/

[ii] “SD Department of Labor, Insurance Division. “South Dakota 2016 Individual non-Tobacco Rates as of: 8/20/15 Exchange.” Retrieved from http://dlr.sd.gov/insurance/consumers/consumer_documents/sd_exchange_rates_individual_2016.pdf Calculated as average silver premium in of 4 geographic areas in South Dakota., calculations by South Dakota Budget & Policy institute

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