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Pueblo’s unemployment is historically low, Medicaid historically high, why?

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When Gov. John Hickenlooper and Sen. Michael Bennet held a health care roundtable in Pueblo last month discussing expected cuts to Medicaid, the two heavyweights in Colorado politics talked about how important Medicaid was in Pueblo. But neither touched the root cause driving the record-high Medicaid rates.

42.3 percent of Pueblo County residents receive health insurance through Medicaid, the government form of insurance for low-income Americans. Partially driving the rate is Medicaid expansion via the Affordable Care Act, which allowed more people to enroll in the program.

When Colorado took advantage of Medicaid expansion, Pueblo County added 20,183 Medicaid recipients.

Why? The eligibility standard allowed more people to enroll in Medicaid — people who fell in between 133 percent and 138 percent of the poverty level. These are people who made more than the required income to qualify for Medicaid, but still couldn’t afford, or worked for companies that didn’t provide, health insurance.

While Medicaid enrollment numbers increased, the unemployment rate in Pueblo County was on the decline. Today it’s at 3.6 percent, among the lowest since the 90s.

So why does Pueblo Medicaid coverage remain high — far above the statewide enrollment rate of 19 percent in 2015 — even though more people are being employed?

Pueblo’s biggest sector is made up of employers that tend to either not provide private health insurance or pays a wage too low for the employee to afford private health insurance.

“The largest employment sector in Pueblo is service industry retail. Those jobs, especially in an economic climate that lags behind the national average, are the lowest paid jobs,” said Pueblo County economic development director Chris Markuson.

Almost one-third of people enrolled in Medicaid work in 10 industries. In 2015, one in 10 Medicaid enrollees worked in food service, according to the Kaiser Family Foundation.

Prior to Medicaid expansion under the Affordable Care Act those workers sat just above the poverty level and didn’t qualify for Medicaid. It was also nearly impossible to afford private health insurance.

“Because of ACA, many people were able to get access to health care, and have returned to work. Personal debt is declining, and families are getting back on stable financial ground,” Markuson said. “Indicators of this are increased retail sales, which allows employees to reward employees with longevity at a business (who aren’t sick for prolonged periods, since they have insurance) with higher wages, and offer private health insurance, leaving Medicaid.”

While income is definitely tied to both the unemployment rate and number of people receiving Medicaid, the two populations are indeed different.

“The unemployment rate looks at the workforce, not the whole population. So it will exclude retirement-age people, those with disabilities and kids,” said Joe Hanel, manager of public policy outreach at the Colorado Health Institute.

“Those three groups combine to make up more than half the Medicaid membership statewide.”

That said, most of the able-bodied adults on Medicaid are indeed employed — 75 percent, according to state officials.

Now, under ACA’s Medicaid expansion, a person making less than approximately 138 percent of the poverty level qualifies for Medicaid. For a single person that amounts to an annual income of around $16,000.  For a family of four to qualify, the annual income is set at around $32,000.

“So, yes, Medicaid is vital to Pueblo’s economy, and for us to (be able to) move our community off of the numerous ‘worst city’ BuzzFeed lists that focus on indicator numbers,” Markuson said.

How is the City of Pueblo, where most employment opportunities are, addressing the connection between low-paying jobs and Medicaid enrollment?

PULP asked Pueblo City Council President Steve Nawrocki if there are any on-going conversations in the city that relate to economic development and how that may impact Medicaid numbers.

Nawrocki, also the executive director of the Senior Resource Development Agency in Pueblo, said there were no conversations that he was aware of, but when the city is discussing incentive packages with prospective companies, the benefits package is an important factor the city takes into account.

The City of Pueblo focuses mainly on attracting primary jobs, which have typically had an income lower than the state average, but still higher than the poverty line.

In most cases, even the lowest-paying primary jobs are double what is eligible for Medicaid. Though it should be noted a family of four relying on one income of less than approximately $32,000 may qualify for Medicaid if employer insurance isn’t provided.

Additionally, through ACA there are some subsidies available for people making less than 400 percent of the poverty level and utilizing health care coverage through an exchange.

Beyond the surface intersection of Medicaid and employment, there’s another pressing factor: the potential declining physical health of the workforce if Medicaid cuts were to happen via the GOP Senate bill.

“What happens when you’re sick? You call off work. Employers don’t like it when you come to work,” said Donald Moore, chief executive officer of the Pueblo Community Health Center.

“It’s all connected. My political thinking is that those people who you think shouldn’t have Medicaid… that’s your workforce.”

Less funding to Medicaid through the current GOP Senate health care plan would mean that the state would have to pick up some of the tab. What that means for Colorado is yet to be completely known, but Moore, anticipates that his facility would have to cut support staff — the people who have become increasingly vital to Medicaid patients.

The support staff — not medical professionals — are the ones at the community health center that make follow-up calls to remind patients to get their prescription, make an appointment or check in to see how a patient is managing side effects.

Among the 24 million people enrolled in Medicaid that are not receiving any Social Security income, nearly 60 percent are working themselves, according to the Kaiser Family Foundation. A total of 78 percent are in families with at least one worker.

And for the enrollees who do not work, the top reason given is inability to find work. Kaiser Family Foundation found that response in 12 percent of unemployed enrollees.

Other major reasons are attendance at school, 13 percent, or other family obligations, 11 percent.

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Written by Kara Mason

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Kara Mason is PULP's news editor. She is also the Society of Professional Journalists Colorado Pro Chapter president. Kara freelances for other regional publications, covering government, politics and the environment.

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