Medicaid expansion hangs in the balance

Medicaid expansion hangs in the balance

When President Obama signed the Affordable Care Act into law on March 23, 2010 he envisioned Medicaid expansion as a mandatory measure. But, while the U.S. Supreme Court backed nearly every aspect of the bill in 2012, they left the mandated implementation up to the states.

The Michigan House of Representatives favored the expansion to more than 470,000 low-income residents in the state, passing House Bill 4714 by tally of 76-31 on June 13th. The Senate then declined to call a vote on the proposition, instead opting for vacation.

Republicans in both the House and Senate are still split on how to move forward with the statute.

“I don’t think it’s really an issue overall of whether reform or expansion is a good or bad thing. There’s a small group of that population in legislature that’s concerned that the federal government either won’t live up to its promise or doesn’t have the capacity at the point where it starts ratcheting down. Right now, the federal government is 100 percent on board and they are responsible for 100 percent of the funding. At some point in time, four or five years down the road, it starts trickling back. It will eventually trickle to where they’ll only take 90 percent of that financial liability,” explained Dennis Smith, President of the Upper Peninsula Health Plan.

But the U.S. Health and Human Services Secretary, Kathleeen Sebelius, has said more than once that if any state can’t afford the 10 percent that they are obligated to pay three years from now, her department will adjust the coverages.

Legislators have been tinkering with ways to pay for the program if in fact the state does end up having to carry the financial load.

“What they’re looking at is incentives for let’s say non-smoking or reduction in weight, healthier lifestyles; things like that. There have been a million little concepts that have been back and forth, back and forth. Like whether to have a premium and give all of those credits if they maintain those five or six things in the first six months so it’s basically a paper wash or we’re going to actually charge them,” Smith noted.

But they might not have the money considering the expansion would go to adults making 133 percent of the poverty level.

In other words, the 14,000 to 16,000 U.P. residents who make around $11,000 a year.

“These are the folks that are out there working one or two or three part-time jobs or they’re at an entry level job, and so their ability to pay for some of that additional insurance is just not there. You can see why they don’t have health insurance because it would almost eat up all of their paycheck just to provide that by the time they got their salary. They pay taxes, rent, and there is no money leftover. If they have an issue it ends up at the emergency room, which is probably the most expensive form of coverage that you can get,” remarked Smith.

The Center for Disease Control estimates that more than $18 billion could be saved each year if patients with non-urgent medical problems were treated by primary care physicians instead of their ER counterparts.

Only time will tell, but if the bill passes 320,000 Michigan residents could then enroll in Medicaid for the 2014 fiscal year beginning October 1st.

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