http://online.wsj.com/news/articles/SB10001424052702304851104579363621009670740?mod=WSJ_article_EditorsPicks
BIRMINGHAM, Ala.—Ernest Maiden was dumbfounded to learn that he falls through the cracks of the health-care law because in a typical week he earns about $200 from the Happiness and Hair Beauty and Barber Salon.
Like millions of other Americans caught in a mismatch of state and federal rules, the 57-year-old hair stylist doesn’t make enough money to qualify for federal subsidies to buy health insurance. If he earned another $1,300 a year, the government would pay the full cost. Instead, coverage would cost about what he earns.
“It’s a Catch-22,” said Mr. Maiden, an uninsured diabetic. Without help, he said, he must “choose between paying the bills and buying medicine.”
Hair stylist Ernest Maiden doesn’t make enough money to qualify for federal subsidies to buy health insurance but also is ineligible for Medicaid. Bob Miller for The Wall Street Journal
The 2010 health law was meant to cover people in Mr. Maiden’s income bracket by expanding Medicaid to workers earning up to the federal poverty line—about $11,670 for a single person; more for families. People earning as much as four times the poverty line—$46,680 for a single person—can receive federal subsidies.
But the Supreme Court in 2012 struck down the law’s requirement that states expand their Medicaid coverage. Republican elected officials in 24 states, including Alabama, declined the expansion, triggering a coverage gap. Officials said an expansion would add burdensome costs and, in some cases, leave more people dependent on government.
The decision created a gap for Mr. Maiden and others at the lowest income levels who don’t qualify for Medicaid coverage under varying state rules. The upshot is that lower-income people in half the states get no help, while better-off workers elsewhere can buy insurance with taxpayer-funded subsidies.