Lessons from the Trade Act Tax Credit
<p>The first comprehensive enrollment estimates for the federal Health Coverage Tax Credit (HCTC) program are in, and the numbers, though higher than some had expected, remain disappointingly low, a <a href="/cnlib/pub/enews_clickthrough.htm?enews_item_id=19198&return_url=http%3A%2F%2Fwww%2Ecmwf%2Eorg%2Fpublications%2Fpublications%5Fshow%2Ehtm%3Fdoc%5Fid%3D311250%26%23doc311250">new Commonwealth Fund Issue Brief</a> finds.<br><br>Approximately 22 percent of eligible individuals received the credit in September 2004, the most recent month for which complete data are publicly available. Total subsidies provided by the HCTC program, meanwhile, are roughly one-third the amount originally projected, say authors Stan Dorn and colleagues at the Economic and Social Research Institute (ESRI) and Northwest Health Law Advocates.<br><br>The analysis contains the first published estimate of HCTC enrollment that takes into account both ineligibility among workers targeted for the credit as well as receipt of the credit in all of its forms. The HCTC program was created by the Trade Act of 2002, primarily to help workers displaced by globalization and early retirees whose former employers defaulted on promised pension payments.<br><br>High premium payments required from beneficiaries, a complex application process, the frequent exclusion of coverage for preexisting conditions, and limited outreach are largely behind the low take-up, the report's authors say. In designing future tax credits aimed at specific populations, they suggest that policymakers ensure that:<UL>
<li>premium costs are affordable for the low-income uninsured and do not require full premium payments while applications are pending;<br><br>
<li>enrollees have access to health plans that cover preexisting conditions and provide benefits that people value;<br><br>
<li>the outreach strategy uses easily understandable, multilingual materials and proactive enrollment efforts; and<br><br>
<li>the application process is kept simple, requiring no more than a single form to be filed with one agency.</ul>
<br>The Issue Brief summarizes the authors' full research report available on the <a href="http://www.esresearch.org/documents_1-05/HCTC_TakeUp.pdf">ESRI Web site</a>.</p>