Last week, 3.3 million Americans filed for unemployment as industries buckled under COVID-19, according to the Department of Labor (DOL). This is the highest number of jobless claims since the DOL started tracking the data in 1967.
This high rate of joblessness exacerbates public health’s “disease-driven poverty trap” phenomenon in which “the combined causal effects of health on poverty and poverty on health implies a positive feedback system,” according to the Proceedings B of the Royal Society, a study by the British biological sciences journal.
According to the New York Times, when a health crisis immobilizes society, it can set off a cycle in which declining economic status leads to rising rates of chronic illness. This, in turn, further depresses productivity and raises health care costs, leading to more poverty, leading to more illness.
This positive feedback system, in which the people who are low-income are more likely to get COVID-19 and COVID-19 triggers a cycle harming the health of those who are low-income, also widens socioeconomic divides, increasing inequality.
Higher rates of inequality is correlated with higher costs of living, leading to paycheck to paycheck lifestyles. The gradual decline of labor unions and rise of part-time work and the gig economy also means low-income workers have fewer protections, including health coverage.
Americans are already skimping out on care due to high costs. According to one Gallup poll, 26 percent of Americans deferred health care because they could not afford it.
In recognition of the staggering unemployment rates and its implications of millions losing coverage during a crisis and exacerbating the positive feedback system, President Trump declared on March 13 COVID-19 a national emergency, enabling the Centers for Medicare and Medicaid Services (CMS) to waive certain requirements under Section 1135 emergency authority. To date, CMS has approved Section 1135 Medicaid waivers for 29 states.
These waivers, which will end upon termination of the emergency, will allow laid-off workers in the 29 states to get subsidized health insurance on the Affordable Care Act (ACA) marketplaces via a special enrollment period. The enrollment period will also provide another opportunity to enroll to those who chose not to this year. Despite the Trump administration working to invalidate the ACA in court, the administration is considering opening the federal marketplaces to enrollees, with support from health insurers.
While the ACA already allows people who have lost insurance via losing their job to enroll, these special enrollment periods would allow anyone without insurance to sign up for a health plan without having the administrative burden of proving special conditions.