The 101: About the Transitional Health Insurance Program

NE_Appleseed_Icons_AffordableCareAct-200On January 19, State Senator John McCollister of Omaha introduced LB 1032, the Transitional Health Insurance Program Act. LB 1032 creates the Transitional Health Insurance Program (or “T-HIP”), which would provide health coverage for the 77,000 Nebraskans in the coverage gap.

Those people who are eligible to covered by T-HIP include single adults and parents who are ineligible for Medicaid but don’t make enough money to qualify for subsidies on the Health Insurance Marketplace to make insurance affordable. The program will also cover Nebraskans who have to “spend down” their income every month to get Medicaid coverage.

What is the Health Coverage in T-HIP?

Most participants in T-HIP will get coverage through a private market insurance plan through what is called “premium assistance” — where Medicaid dollars are used to buy private plans. Other participants who have an offer of insurance through their job can get help affording that coverage. Finally, other participants, including those who are medically frail or who have serious or chronic health conditions, will receive traditional Medicaid coverage. All participants will also be able to see a primary care doctor.

What will it cost participants?

Most T-HIP participants will have to contribute 2 percent of their monthly household income as a premium. Participants who use the emergency room for a non-emergency will also face a copayment of up to $50. But, participants aren’t responsible for other private insurance costs, like deductibles. If someone doesn’t pay the premium, they can’t be cut off from coverage, but the amount of the unpaid premium is a collectable state debt.

Job Opportunities for hard-working Nebraskans

LB 1032 also creates an opportunity for people to gain the skills they need to move up in their careers.  While we know that most Nebraskans eligible for T-HIP are working, LB 1032 provides for a program that allows participants to get the education and training they need to advance.

How is LB 1032 funded?

Most of the cost of T-HIP coverage is paid for with federal funds — that is tax dollars Nebraskans already have paid. The federal government pays 95 percent of the costs for T-HIP in 2017, and will never pay less than 90 percent of the costs in the future. This lets Nebraska bring our tax dollars home to work for us.

There are programs currently paid for with state dollars that would become unnecessary if T-HIP passes, so we could end those and see significant savings in other areas of the state budget. These savings come from corrections, the state disability program, drug assistance programs, behavioral health, and breast and cervical cancer screenings. This will help offset any cost to the state for T-HIP.

A Healthy Plan for Nebraska

All in all, LB 1032 is a good deal for Nebraska. We can help ensure that our friends and neighbors have the health coverage that they need, while also bringing back around $2 billion in Nebraskans’ tax dollars between now and 2020 to invest in our economy.

We urge you to contact your State Senator today and tell them to support LB 1032 so every Nebraskan can get the health coverage that we all need.

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