At risk: Med­i­caid ex­pan­sion

Modern Healthcare - - NEWS - By Har­ris Meyer

States that chose to con­tinue cov­er­ing that pop­u­la­tion would have to pony up the dif­fer­ence be­tween the en­hanced fed­eral match­ing rate of 90% and their tra­di­tional Med­i­caid match­ing rate, which av­er­ages 57%.

In Penn­syl­va­nia, law­mak­ers would have to come up with $2 bil­lion to $3 bil­lion an­nu­ally to sus­tain its Med­i­caid ex­pan­sion if the cur­rent ver­sion of the Amer­i­can Health Care Act is en­acted. West Vir­ginia, which ex­panded cov­er­age to 175,000 peo­ple, would have a $50 mil­lion gap to make up start­ing in 2020.

Health­care lead­ers in Ohio, New Jersey, Penn­syl­va­nia and West Vir­ginia pre­dicted their states would ter­mi­nate their ex­pan­sions if Congress passed the AHCA with its Med­i­caid pro­vi­sions in­tact. Na­tional ex­perts said they see very few of the 31 ex­pan­sion states hav­ing the fi­nan­cial ca­pac­ity or po­lit­i­cal will to main­tain the ex­pan­sions to low-in­come adults if the bill’s large cut in fed­eral fund­ing is en­acted.

The bill largely ends the fed­eral govern­ment’s en­hanced Med­i­caid con­tri­bu­tions in 2020 to cover adults with in­comes up to 138% of the poverty level. States that chose to con­tinue cov­er­ing that pop­u­la­tion would have to pony up the dif­fer­ence be­tween the en­hanced fed­eral match­ing rate of 90% and their tra­di­tional Med­i­caid match­ing rate, which av­er­ages 57%.

That’s a huge worry for health­care providers, who fear it would lead to a big jump in un­com­pen­sated care and re­duced health­care ac­cess for low-in­come adults. An es­ti­mated 14.5 mil­lion adults across the coun­try have re­ceived cov­er­age un­der the Af­ford­able Care Act’s Med­i­caid ex­pan­sion, which pro­vided $73 bil­lion in fed­eral fund­ing to the states in 2016, ac­cord­ing to the Robert Wood John­son Foun­da­tion.

At least eight states—Arkansas, Ari­zona, Illi­nois, In­di­ana, Michi­gan, New Hamp­shire, New Mex­ico and Wash­ing­ton—have laws re­quir­ing them to re­duce or elim­i­nate Med­i­caid el­i­gi­bil­ity and/or ben­e­fits for the ex­pan­sion pop­u­la­tion if the fed­eral govern­ment re­duces its con­tri­bu­tion.

“It’s al­most be­yond imag­i­na­tion that Penn­syl­va­nia’s Med­i­caid ex­pan­sion could sur­vive the re­duc­tion in en­hanced fed­eral fund­ing,” said Andy Carter, CEO of the Hos­pi­tal and Healthsys­tem As­so­ci­a­tion of Penn­syl­va­nia, a state where nearly 700,000 peo­ple have got­ten cov­er­age through the ex­pan­sion.

States would con­tinue to re­ceive the richer fed­eral match for ex­ist­ing ex­pan­sion en­rollees who re­mained con­tin­u­ously in the pro­gram, but it’s pro­jected the vast ma­jor­ity of those ben­e­fi­cia­ries would cy­cle out of the pro­gram within two years, par­tic­u­larly given the bill’s re­quire­ment that they re­cer­tify el­i­gi­bil­ity ev­ery six months rather than the cur­rent an­nual re­quire­ment.

In Ohio, where 700,000 peo­ple have gained cov­er­age in the ex­pan­sion, the state would have to shoul­der an ad­di­tional $2.2 bil­lion if that many peo­ple were still on the rolls in 2020. The state would likely turn to provider cuts to make up the dif­fer­ence. Al­ready in this year’s bud­get pro­posal, Ohio re­port­edly plans to cut Med­i­caid rates for hos­pi­tals by 8% be­cause of the un­cer­tain­ties around ACA re­peal. Over the next two years alone, Ohio hos­pi­tals would see a cut of more than $588 mil­lion.

That doesn’t sit well with Sen. Rob Port­man (R-Ohio). “I’ve al­ready made clear that I don’t sup­port the House bill as cur­rently con­structed be­cause I con­tinue to have con­cerns that this bill does not do enough to pro­tect Ohio’s Med­i­caid ex­pan­sion pop­u­la­tion, es­pe­cially those who are re­ceiv­ing treat­ment for heroin and pre­scrip­tion drug abuse,” he said.

The non­par­ti­san Con­gres­sional Bud­get Of­fice pro­jected in March that 5 mil­lion fewer peo­ple would be en­rolled in Med­i­caid by 2026 due to the bill’s var­i­ous Med­i­caid changes. It said that due to the smaller fed­eral con­tri­bu­tion, no new states would ex­pand Med­i­caid and that “some” ex­pan­sion states would no longer of­fer that cov­er­age.

States would face a hard re­al­ity in 2020, said Deb­o­rah Bachrach, a part­ner at Manatt Health and a for­mer New York state Med­i­caid di­rec­tor. Philo­soph­i­cally and po­lit­i­cally they may want to sup­port ex­pan­sion. But they’ll ask, “Do I have the dol­lars to main­tain cov­er­age?” she said.

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