An Introduction to US Health Insurance Plans Tailored for Underserved Communities with Low-Income
Author: Weiwei Liang, Cindy He, Alina Zou
As we may know, healthcare services in the US are often paired with a high cost, due to the number of resources, time, and other factors that go towards the service and may not be too obvious to the general public at first glance. Due to the high cost, many individuals are unable to afford health insurance, thereby delaying treatment that could cause detrimental consequences. In this article, we aim to first present an overview of some brackets of insurance plans for individuals who hold different access to medical resources of economic levels in the US. Then, we will dive deeper into a majorly influential program, the Affordable Care Act (ACA), and how the changes it has brought to the realm of health insurance, especially for underserved populations with lower income.
Overview of Insurance Plans for Underserved Populations with a Low/Medium Annual Income:
The foundation of different insurance plans can vary widely based on the income level of the individuals they are designed to suit. For example, high-income individuals typically have access to a range of insurance options, including private health insurance plans, employer-sponsored plans with comprehensive coverage, and supplemental insurance policies for additional benefits. However, individuals and families with low to medium income face more limited options. In this article, we will give an overview of a few of the different insurance plans that are designed for individuals with low to medium income in the US, and highlight the Affordable Care Act’s (ACA) core features in patient care settings.
According to the US government website, Medicaid and the Children’s Health Insurance Program (CHIP) provide free or low-cost health coverage to some low-income populations, including families, children, pregnant women, the elderly, and people with disabilities. Some states have now expanded their Medicaid programs to cover all individuals below certain income level brackets. For example, a family of three who live in Illinois with an annual income of $35,631 may be eligible for free or low-cost coverage through Medicaid, but if they move to Georgia, they must have an annual income of below $25,820 to get the same eligibility. Meanwhile, states including California and D.C. run their own health marketplace. Individuals with low to medium income in the US largely rely on government-sponsored insurance programs such as Medicaid or the Children's Health Insurance Program (CHIP). Even if your income exceeds the qualification requirement for Medicaid, your child may still qualify for the Children's Health Insurance Program (CHIP). It covers basic medical and dental care services for uninsured children and teens up to age 19 based on Healthcare.gov.
In some cases, consumers may also qualify for subsidized marketplace plans under the Affordable Care Act (ACA), which often covers services such as doctor visits, hospital stays, prescription drugs, and preventive care with lower premiums and out-of-pocket costs. These insurance plans usually have minimal or no premiums, low deductibles, and minimal out-of-pocket costs. Government subsidies cover the majority of the plan expenses for eligible individuals. Individuals with low annual income can enroll in Medicaid or CHIP through their state's Medicaid agency or apply for subsidized marketplace plans through the ACA exchange in their state.
Medium-income individuals may have wider access to a variety of insurance options, including employer-sponsored plans (different types of group health plans, health reimbursement arrangements, and employee stipends), marketplace plans under the Affordable Care Act (ACA), and government-sponsored programs like Medicaid. These plans typically offer a balance between coverage and affordability. However, they often hold more restricted provider networks and higher out-of-pocket costs compared to plans designed for higher-income holders. Medium-income insurance plans often come with moderate premiums, deductibles, and copayments. Some individuals in this income bracket might qualify for premium subsidies or cost-sharing reductions under the ACA, making coverage more affordable. Medium-income individuals can obtain insurance plans through their employers, state-based ACA marketplaces, private insurers, insurance agents, or community health centers.
Introduction to the Affordable Care Act (ACA) in the United States
The Affordable Care Act (ACA), also referred to as "Obamacare", was enacted in 2020 to make health insurance more accessible and affordable with higher quality. Based on KFF.org, The ACA introduced a series of revisions that increased the number of people eligible for receiving health insurance by expanding the Medicaid program to nearly all adults with incomes up to 138% of the Federal Poverty Level, which is $20,783 for an individual in 2024. This comprehensive legislation solved some prominent challenges in the healthcare system, such as lowering the costs of the insurance plan and allowing people with lower income levels in underserved communities to receive health coverage. The ACA established health insurance subsidies to help lower or eliminate the out-of-pocket cost of health coverage. According to the federal Centers for Medicare and Medicaid Services, 80% of consumers are paying $10 a month for health insurance or less after subsidies under the ACA. Moreover, The ACA prohibited insurance companies from denying coverage or charging a higher cost based on the pre-existing chronic health conditions of consumers. As for this, ACA implementation increased the accessibility and affordability of health insurance in the US.
To be eligible for the ACA, individuals must:
Live in the US
Must be a U.S. citizen or national (or be lawfully present)
Not be incarcerated
The Affordable Care Act includes a few types of health insurance plans that are tailored to the buyer’s income level and medical needs. The following plans under the ACA are:
The Bronze plan requires to lowest monthly premium, but has the highest costs when the patient needs care. This plan is most suited for individuals who do not expect to receive constant medical services, and are willing to pay for most of the care themselves. The Platinum plan is the opposite of the Bronze plan, where the individual is required to pay the highest monthly premium, but has to lowest out-of-pocket expense when receiving the care. This plan is best suited for patients who expect to receive constant medical services. When choosing a plan, the individual is recommended to consider their health condition carefully before purchasing in order to choose the best plan for them.
Highlights of how the ACA benefited Patient Care:
From baseline and preventive care to long-term health management, health insurance and the number of medical personnel play a crucial role in diagnosing, treating, and managing health conditions and diseases. Under the ACA, some revisions pertaining to health services were made:
The expansion of Medicaid and CHIP (pediatric) eligibility allowed more individuals to receive healthcare without having to worry about the bills that come later. Based on the White House, The ACA increased the number of individuals who qualified for Medicaid and CHIP by 41.7% compared to pre-expansion years.
The ACA enhanced the primary care workforce by investing in training programs for physicians, nurse practitioners, and physician assistants which aim to address the shortages of primary care providers. This allowed a substantial amount of individuals under the plan to have access to primary care services. The Affordable Care Act included $200 million for the Graduate Nurse Education (GNE) Demonstration, which aimed to increase the supply of advanced practice nurses, particularly in primary care in underserved areas. So the Centers for Medicare and Medicaid Services (CMS) required that at least 50% of the GNE-funded hours occur in community-based primary care settings, increasing access to care for those who need it the most.
To summarize, The Children's Health Insurance Program (CHIP), Medicaid, and the Affordable Care Act (ACA) are three distinct but interconnected programs that aim to improve access to healthcare coverage for individuals and families in the United States, particularly those with low income or specific demographic characteristics. It is important to note that the specifics of insurance plans can vary based on factors such as location, regulations, and individual circumstances. Additionally, eligibility criteria and coverage details for government-sponsored programs like Medicaid and CHIP are determined by each state's guidelines.
All in all, in this article, we looked at insurance plan options for low/medium-income individuals in the US, and introduced one of the most influential acts in healthcare, the Affordable Care Act with some of its highlights. Overall, CHIP, Medicaid, and the ACA share the common goal of improving access to affordable healthcare coverage for vulnerable populations. We aim to promote a better understanding of one of the components of the American healthcare system. In the following part 2 of the health insurance series, we will focus on insurance plans, such as Medicaid, designed for other vulnerable populations, such as the elderly and disabled individuals in the US.
