Hispanic Americans, the largest and fastest growing racial/ethnic group in the United States, are likely to have higher risk for certain chronic or serious health conditions, such as diabetes, than White Americans, yet face several barriers in accessing health care coverage. Therefore, the guaranteed health coverage offered by Medicare and Medicaid is especially important to the Hispanic community, which has a huge stake in protecting, improving and strengthening Medicare and Medicaid.
In the United States, there are over 57.5 million Hispanic Americans, accounting for approximately 20 percent of the total population. Hispanics have the highest uninsured rate among racial/ethnic groups. In 2015, 9 million Hispanics were uninsured. While the Affordable Care Act (ACA) has decreased the rate of uninsured Hispanics, approximately 16 percent still lack health insurance coverage.
Hispanics disproportionately work in blue collar industries such as agriculture, service and construction, where they are less likely to receive employer-sponsored health insurance. Even when an employer offers health insurance, many Hispanic Americans cannot afford to pay their share. Because Hispanic workers are concentrated in low-wage jobs, typically without pensions, it is also difficult for them to accumulate retirement savings during their working years.
In 2016, half of all people with Medicare lived on incomes of $26,200 or less per year – a little more than 200 percent of the federal poverty level. However, the median income for Hispanic Medicare beneficiaries was $13,650.
Medicare provides health coverage for most Americans when they reach age 65 or have been receiving Social Security disability benefits for 24 months. Currently, Medicare covers a portion of the health care costs of over 55 million Americans, including approximately 4.4 million Hispanic Americans.
Medicare’s guaranteed health care coverage is crucial to Hispanic Americans; however, it does not pay the full cost of hospital and doctor care, prescription drugs and other health services. Medicare beneficiaries must pay for Medicare premiums, coinsurance and copayments, plus health care services not covered by Medicare, like dental, vision and hearing. These out-of-pocket costs are a burden for Medicare beneficiaries with low incomes and high health care needs, including many Hispanic Americans who are elderly or disabled.
The share of income Medicare beneficiaries spend on health care is significant and growing. The cost of Medicare Part B and D premiums and cost sharing as a percentage of the average Social Security benefit increased from seven percent in 1980 to 14 percent in 2000 and to 25 percent in 2017. Out-of-pocket costs are a great burden for many elderly Hispanics who are living on low incomes mostly made up of Social Security benefits.
Medicare Supplemental Coverage
Most Medicare beneficiaries have supplemental insurance (Medigap) to cover the gaps in Medicare, although Hispanics are more likely than Whites to have only traditional Medicare. They are much less likely than Whites to have employer-provided retiree health benefits. A higher percentage of Hispanics than Whites are enrolled in private Medicare Advantage plans, which provide Medicare benefits and often include prescription drug coverage as well.
Medicare Savings Program
Some low-income Medicare beneficiaries may be eligible for assistance to help cover their health care costs. The Medicare Savings Program, administered by the states, helps people with limited income and savings with some or all of their Medicare premiums, deductibles and coinsurance expenses.
The Low-Income Subsidy (LIS), also known as “Extra Help,” assists some low-income seniors (annual income less than $18,090 for an individual or $24,360 for a couple) with their Medicare Part D prescription drug costs. In 2018, low-income seniors may qualify for a subsidy if they have combined savings, investments and real estate not worth more than $27,600 for a married couple or $13,820 for a single person. (These amounts do not include a home, vehicles, personal possessions, life insurance, burial plots, irrevocable burial contracts or back payments from Social Security or Supplemental Security Income.)
Affordable Care Act
The ACA assists many older Hispanics by providing preventive services with no out-of-pocket costs and discounts on their prescription drugs. In 2015, the last year for which this data was available, more than 39 million seniors received one or more free preventive services, such as flu shots and diabetes screenings, and nearly nine million beneficiaries took advantage of the annual wellness visit.
The ACA provides relief for people in the Medicare prescription drug coverage gap or donut hole. In 2018, Medicare beneficiaries in the donut hole are receiving a 65 percent discount on brand-name drugs and a 56 percent discount on generic drugs. Seniors will see additional savings on covered brand-name and generic drugs while in the coverage gap, until the gap closes in 2019.
In brief, it is important to assess the impact of Medicare proposals that would reduce federal spending for Medicare by shifting costs to beneficiaries. Requiring beneficiaries to pay more could lead many seniors to forgo necessary care, which could lead to more serious health conditions and higher costs. Given the lower incomes and poorer health of communities of color, including Hispanics, benefit cut proposals would have a disproportionate effect on them.
Medicaid, a joint federal and state program, provides health insurance to over 72 million low-income individuals in the United States. This includes coverage for seniors, people with disabilities, children and some low-income adults. Medicaid is an especially important source of health insurance for low-income Hispanics.
In 2016, Medicaid provided coverage to 17.8 million Hispanic Americans, who account for nearly one-third of Medicaid enrollees. Medicaid is a particularly important source of coverage for Hispanic children, covering more than half of them.
The ACA created new opportunities under Medicaid for coverage. As a result, some low-income Hispanic individuals may be able to receive health coverage in states that expand their Medicaid programs or through the new health insurance marketplaces. Since 2014, states have had the option to expand Medicaid coverage to adults with incomes up to 138 percent of the poverty level ($28,676) for a family of three in 2018. According to a January 2018 Gallup survey, Hispanics have seen nearly a 10-percentage point drop in their rate of uninsured from 38.7 percent in 2013 to 29.6 percent in 2017. However, significant coverage gaps remain. In states that have not expanded Medicaid, many Hispanics remain uninsured.
For individuals who aren’t eligible for Medicaid, the ACA also establishes health insurance marketplaces, where uninsured individuals can purchase health coverage. Tax credits are available to help moderate-income people buy health insurance. Because of the health insurance marketplaces, millions of uninsured Hispanic Americans gained access to new opportunities for coverage.
NATIONAL COMMITTEE POSITION
It is vital that America’s Hispanic population understands the essential health care needs Medicare and Medicaid can fill within the community. The National Committee also believes additional education is necessary to ensure that all Americans are aware of the Medicare and Medicaid benefit and coverage improvements available to them under the Affordable Care Act. Under Medicare, seniors receive preventive services with no cost-sharing, annual wellness visits with personalized prevention plans and help with their prescription drug costs. States are encouraged to expand their Medicaid programs because it would increase access to affordable health coverage for low-income Americans and help individuals better manage their chronic conditions. At the same time, the National Committee opposes proposals to cut Medicare benefits, repeal the Affordable Care Act and reduce federal funding of Medicaid, particularly since these actions would disproportionately affect communities of color, including Hispanic Americans.
Instead, we strongly believe that Congress should equip Medicare for the economic and health care challenges facing elderly Hispanics and all seniors by enacting a catastrophic out-of-pocket limit; counting all hospital observation days toward meeting eligibility for skilled nursing facility benefits; covering vision, dental and hearing services; and addressing underlying costs, particularly skyrocketing drug prices.