What happens when workers lose health insurance?

Higher medical costs.

WCRI’s Sebastian Negrusa PhD’s presentation kicked off yesterday’s afternoon with an excellent summary of what has happened to workers who lost their health insurance - and insights into what will happen as the Trump Administration continues to make health insurance less accessible and more expensive (my words not his).

We’ll focus mostly on Medicaid - which is available to employed folks who (generally speaking) make less than 138% of the Federal Poverty Level (note this varies by state).

A substantial number of workers lost Medicaid after March 2023 due to the “unwinding” of COVID-era Medicaid regulations. This gives us insights into what might happen when HR1 - Republicans’ OBBBA budget bill that was signed into law last year - is fully implemented.

Alert - there’s some REALLY USEFUL underwriting intel here.

Here’s what Dr Negrusa reported yesterday about the impact of Medicaid unwinding:

(note these are preliminary and may change - although in my experience they rarely change much if at all)

Medical payments for lost time claims were up 3.1% overall - but this varied a LOT with costs up a whopping 10.1% for construction workers.

Oh, and guess which providers made out the best? Yup, hospitals, where payments jumped 6.7% while non-hospital providers saw a 3.3% decrease.

What does this mean for you?

One of the key drivers of medical inflation in work comp is the changes to Medicaid.

This fall we’ll see a much bigger reduction in Medicaid coverage - insurers would be wise to start figuring out just how much higher their rates need to be.