The Affordable Care Act and Native Americans

The Affordable Care Act—aka the ACA or Obamacare—has provided many previously uninsured Native Americans and Alaska Natives with the opportunity to obtain health insurance coverage. This article will explain the provisions in the ACA that apply to Native Americans and Alaska Natives.

According to 2020 U.S. Census data, there are 9.7 million Native Americans and Alaska Natives in the United States, accounting for 2.9% of the country's population. From 2009 to 2011—shortly before the Affordable Care Act was implemented—roughly 30% of the Native American/Alaska Native population was uninsured—compared with 17% of the total US population.

Native Americans and Alaska Natives have access to free health care provided by Indian Health Service (IHS) facilities, but IHS facilities tend to be located near reservations, and more than three-quarters of Native Americans and Alaska Natives do not live on reservations or tribal land.

Even when IHS facilities are local, necessary health care isn't always available in a timely manner, and the agency has long been plagued with staffing shortages and underfunding.

For a variety of reasons, Native Americans and Alaska Natives have poorer overall health outcomes than the US population as a whole. To address the health disparities, and in an effort to reduce the uninsured rate among Native Americans and Alaska Natives, the ACA included some provisions that make coverage more accessible and health care more affordable for Native Americans and Alaska Natives:

Limited cost-sharing

Cost-sharing is the amount of money that patients have to pay out of their own pocket for their health care. Under the ACA, total out-of-pocket costs are limited to no more than $8,700 for a single individual in 2022, and no more than $9,100 in 2023. But health plans can have lower out-of-pocket limits and have significant flexibility in terms of how they structure their cost-sharing using copays, deductibles, and coinsurance.

For Native Americans and Alaska Natives, there are special provisions regarding cost-sharing:

• For Native Americans and Alaska Natives with household income up to 300% of the poverty level, there's no cost-sharing on health insurance plans purchased through the exchange (for 2023 coverage, that's about $69,000 for a family of three in the continental U.S., more than $86,000 for a family of three in Alaska and more than $79,000 for a family of three in Hawaii). Monthly premiums (the cost of the insurance itself) must be paid, although premium subsidies can offset a significant portion of the cost, depending on income. But when care is received, there are no copays, deductibles, or coinsurance. 
• For all Native Americans and Alaska Natives who enroll in a health plan through the exchange—including enrollees with household income above 300% of the poverty level—there's no cost-sharing (copay, deductible, coinsurance) for any health care that's obtained at an IHS or tribal facility, or from a provider who's contracted with IHS.

Year-round enrollment

The ACA introduced the concept of an annual open enrollment window to the individual health insurance market. Prior to 2014, individual health insurance could be purchased at any time during the year, but applicants in most states had to be relatively healthy in order to be approved for coverage.

Under the ACA, everyone can get coverage, regardless of medical history. But the trade-off is that health insurance is only widely available during open enrollment (in most states, the enrollment window is November 1 through January 15). After open enrollment ends, coverage can only be purchased by people who experience qualifying events that trigger special enrollment periods. 

But Native Americans and Alaska Natives are not restricted to enrolling during open enrollment, nor do they need qualifying events. They can enroll at any time, year-round (through the exchange only; the year-round enrollment does not apply off-exchange).

No penalty for being uninsured

Under the ACA, there was a penalty for being uninsured, although it the penalty was eliminated as of 2019. It was calculated on federal tax returns, and it applied to anyone required to file a return who was uninsured during the previous year and didn't qualify for an exemption from the penalty. 

But Native Americans and Alaska Natives who are members of a federally recognized tribe (or who are otherwise eligible for care through IHS) were exempt from the penalty. They could obtain their exemption from the exchange or from the IRS when they filed their tax returns.

Indian Health Care Improvement Act

The Indian Health Care Improvement Act, which funds IHS, was passed by Congress in 1976 and was last reauthorized in 2000. But the ACA permanently reauthorized the Indian Health Care Improvement Act, and added additional benefits, including programs for mental and behavioral health treatment, and long-term care services. 

Medicaid expansion

In 2017, the poverty rate among single-race Native Americans and Alaska Natives was 20.8%, compared with 9.5% for the entire US population. The higher-than-average poverty rate among Native Americans and Alaska Natives (higher than any other race group) made the ACA's Medicaid expansion particularly important for these populations.

The ACA called for the expansion of Medicaid to cover all adults with household income up to 138% of the poverty level (children were already covered at higher income levels under a combination of Medicaid and Children's Health Insurance Program). And the federal government pays 90% of the cost of Medicaid expansion.

But the Supreme Court ruled in 2012 that states could opt out of Medicaid expansion, and 12 states still have not expanded Medicaid coverage as of 2022.

In seven states (Alaska, Arizona, Montana, New Mexico, North Dakota, Oklahoma, and South Dakota), Native Americans and Alaska Natives comprise at least 3% of the total population. Of those states, all but South Dakota have expanded Medicaid.

But more than half of all Native Americans and Alaska Natives live in just seven states (Alaska, North Carolina, Texas, New Mexico, Oklahoma, California, and Arizona). Of those states, North Carolina and Texas have not expanded Medicaid. Across just those two states, there are nearly one million people in the Medicaid coverage gap (about 44% of all the people in the coverage gap across the dozen states where a coverage gap exists). That number certainly includes some Native Americans.

People in the coverage gap don't qualify for Medicaid because the state hasn't expanded eligibility, and they also don't qualify for premium subsidies in the exchange because subsidies aren't available to people with income under the poverty level (since they were supposed to have access to Medicaid instead).

So while Medicaid expansion has had a significant impact in insuring low-income Native Americans and Alaska Natives, this only applies in the states where Medicaid has been expanded.

Summary

Under the ACA, Native Americans and Alaska Natives can apply for coverage through the exchange/marketplace at any time during the year. And if their household income doesn't exceed 300% of the poverty level, they qualify for health coverage that has no deductible, copays, or coinsurance.

A Word From Verywell

The ACA has helped to ease some of the health disparities that long existed in the Native American/Alaska Native population. If you or a loved one are part of a native tribe, you may find that your health coverage options through the exchange/marketplace are better than you expected.

Depending on your income, you may find that the available plans will cover 100% of your medical costs. And regardless of income, Native Americans and Alaska Natives can enroll in a health plan through the exchange at any time of the year, without needing a specific qualifying life event.