How Obamacare will help the uninsured and unemployed

On Thursday, the day the Supreme Court upheld Obamacare, a 47-year-old Baltimore woman went to the drugstore, and pulled out her debit card to pay for a prescription refill. But she didn't have enough money in the account to cover the $425 charge.

So she asked the pharmacist and staff for a favor.

"I asked them to break up the prescription to give me one-third," says the woman, who would not allow her name to be published because she didn't want to disclose her medical conditions. "This was just for three of the five life-saving medications I take."

There's a reason why Ann could only afford a third of some of the drugs her doctor prescribes, and it can be summed up in five words: "I have no health insurance."

Ann is unemployed, having lost her job as an art teacher a year ago. She says her unemployment income is "too large to qualify me for state health benefits," which is hard to believe, but we'll come back to that.

"I pay $1,000 in health care costs per month," she says. "I do not use the emergency room. I do not see doctors except for a non-discounted $75 per month fee for prescription refills every two months. I pay full price for eyeglasses and dental care."

She lays all this out — a set of facts undoubtedly familiar to a few million uninsured, single American adults — and, in light of last week's Supreme Court decision, Ann asks, with incredulity, this question:

"I now have to pay a tax on top of my out-of-pocket health care costs?"

She alludes to the Supreme Court ruling that the individual mandate in the nation's new health care law is constitutional on tax law grounds. Barring Mitt Romney's election and a Republican-led repeal of the law, the Internal Revenue Service will soon be able to impose a tax penalty of either $695 a year or 2.5 percent of income, whichever is greater, on anyone who doesn't secure health insurance.

Ann got alarmed when she heard this.

She's already out-of-pocket $12,000 a year for medical expenses, and the IRS is going to hit her with a tax penalty, too?

I told Ann to sit tight while I got her some answers.

She's probably not the only uninsured American who thinks they're going to be penalized for not being able to afford health insurance.

But the worthy goal of the Affordable Care Act is to get more people insured — up to 30 million more — by either expanding the Medicaid program for the poor or by making private insurance more affordable to the middle class. Part of that $12,000 Ann pays now toward medical expenses will go toward securing insurance — and she'll save a lot of money during the course of a year. Once insured, she won't have to pay the tax penalty, either.

I called Kathy Westcoat, president of HealthCare Access Maryland, the Baltimore-based nonprofit that helps people like Ann navigate the health delivery system. There are a lot of Marylanders who either don't know what benefits are available to them or, unemployed for the first time in their working lives, have too much pride to ask for help (or to allow their full names to be published in a newspaper.)

First question for Westcoat: Could an unemployed woman with $12,000 a year in annual medical expenses really be ineligible for public health care benefits, even after the expansion of Medicaid in Maryland a few years ago?

"It sounds crazy," says Westcoat, "but it's often true. The state has a program, Primary Adult Care, for single adults between 19 and 64. PAC has some good benefits — free primary care doctor visits, free or low-cost prescription drugs — but it's very limited. You can't see a specialist, for instance; it's not good for people with chronic diseases."

And it's not available for any able-bodied person who has more than $1,050 a month in income. So, single Maryland adults who lose their jobs and collect more than, say, $260 a week in unemployment benefits can't get into PAC. The best they can do is pick up some temporary help with medical bills through charity.

Westcoat offered Ann some relief from an emergency prescription fund supported by HealthCare Access donors.

"We can help her with her prescriptions for a month or two," she says.

But what about Obamacare?

What happens to Ann when the law takes effect? Will someone in her shoes be better off?

"It depends on her income level," says Westcoat, "but if she's a single adult and makes $15,000 a year or less, she gets into Medicaid, starting in 2014. But if she makes more than that and doesn't have insurance, she can get into a health insurance exchange, and receive a subsidy. ... She'll be able to buy health insurance at a fraction of what she's paying now in medical bills."

And she won't have to worry about paying a tax penalty for not having insurance.

It's nonsense to even think about repealing a law that would make all that happen.