Medicaid Rally

Hundreds rallied Feb 4 on the steps of the Idaho Capitol, calling on lawmakers to implement the voter-approved Medicaid expansion without restrictions.

The Centers for Medicare and Medicaid Services has said Idaho’s application to let some people get insurance through the Your Health Idaho state exchange who otherwise would be covered by Medicaid expansion is “incomplete.”

Although the state could resubmit its application, and Gov. Brad Little and Republican legislative leaders said they are working on doing just that, CMS Deputy Administrator Randy Pate wrote that even if the state responds with more information, CMS likely won’t approve the state’s “Coverage Choice Waiver” application since helping people pay for exchange insurance with federal tax credits would cost the federal government more money than covering them through Medicaid.

“The Department of Health and Human Services and the Department of the Treasury ... believe that, even if the application were revised to include the correct elements, Idaho’s application would not be approvable because it could not demonstrate compliance with the statutory guardrails, in particular, the deficit neutrality guardrail,” Pate wrote Thursday in a letter to Idaho Department of Insurance Director Dean Cameron.

Idaho voters approved Medicaid expansion via ballot initiative in November 2018. This year lawmakers approved funding for expansion but also voted to apply for several waivers to make changes to the program. One of them would have given people making between 100% and 138% of the poverty level, who would be covered by Medicaid under full expansion, the option of either going on Medicaid or getting insurance through the state exchange.

Most people on the exchange pay for most of the cost of their insurance with the help of federal income tax credits. As of earlier this year, an estimated 18,000 Idahoans making between 100% and 138% of the poverty level had exchange insurance and, without a waiver, would have to give up their current policies for Medicaid under Medicaid expansion.

Pate wrote that CMS would need more detailed estimates to show that covering people on the exchange rather than Medicaid would be cheaper for the federal government.

“Currently, the state’s application also contains no information to support a conclusion that the proposed 1332 waiver would not increase the federal deficit, when evaluated under the assumption that the state’s Medicaid expansion is approved,” Pate wrote. “Moreover, several public comments on the application submitted to the state cite a prior 1332 waiver application the Idaho Department of Insurance released for public comment on November 3, 2017 to show that the federal cost of providing the Exchange subsidies substantially exceeds the federal cost of Medicaid, which suggests that the 1332 waiver would not meet the deficit neutrality requirement in this scenario.

“Any section 1332 waiver application that would increase the federal deficit cannot be approved by the federal government.”

As a result, Pate wrote, “Idaho’s 1332 waiver application does not include information sufficient to determine if the coverage, affordability, comprehensiveness, and deficit neutrality requirements ... can be met. Without using appropriate assumptions, the application does not provide sufficient information to isolate and evaluate the effect of the waiver.”

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Reclaim Idaho, the group that got Medicaid expansion on the ballot and that spent much of the 2019 legislative session pushing against making any changes to it, hailed CMS’ response.

“This is what happens when angry legislators try to steer working Idahoans onto plans that offer less comprehensive coverage for higher costs and greater out-of-pocket expenses,” said Reclaim Idaho Executive Director Rebecca Schroeder. “This was a bait-and-switch healthcare scheme promoted as a ‘choice’ but geared toward giving Idahoans less healthcare coverage at higher prices to patients and taxpayers.”

“When you’re talking about working Idahoans, $7,000 in out-of-pocket expenses may as well be $7 million,” said Reclaim co-founder Luke Mayville. “Trying to put working Idahoans on exchange-based plans with less comprehensive coverage at higher prices when they already qualify for Medicaid Expansion makes no fiscal sense — and it’s just cruel.”

Little, House Speaker Scott Bedke, R-Oakley, and Senate President Pro Tempore Brent Hill, R-Rexburg, put out a joint statement saying they were disappointed but the state is “already taking steps to submit the additional information required by CMS so that our application can be fully considered on its merits.”

“Simply put, CMS pulled the rug out from under us,” they said. “For months, state agencies worked closely with the federal agencies on the purpose and goals of the waiver application. We shared multiple strategies and considerations about how Idaho would approach the cost neutrality portion of the application. At no time during those conversations did the federal government indicate Idaho’s approach to the budget neutrality guardrail would be insufficient for consideration.”

Legislative Democrats unanimously opposed most proposals to change Medicaid expansion during the session. The Democratic leadership put out a statement hailing the letter.

“Idahoans have asked us to implement Medicaid expansion as-is but Republican legislators are determined to waste taxpayer dollars on restrictions,” the statement said. “It has become increasingly clear that these legislators do not advocate for the people and are only interested in their own power. We hope that voters will remember this negligent behavior toward Medicaid expansion during the next election.”

Idaho has several other Medicaid expansion waivers pending. The most controversial is a proposal to add work requirements for Medicaid expansion beneficiaries. The state is taking public comment on it now, and plans to submit it to CMS in about a month. This one could have a better chance of being approved — although work requirements have been challenged in court in several other states, the Trump administration supports them and has been approving similar waiver applications.

Two other waiver applications, to put restrictions on using family planning care providers other than one’s doctor and to let the state spend some Medicaid money on mental health and drug treatment that it couldn’t otherwise, are expected to be released for public comment in early September, according to the state Department of Health and Welfare.

Whether these waivers are approved or not, Medicaid expansion enrollment starts on Nov. 1 and coverage will kick in on Jan 1, 2020.

Reporter Nathan Brown can be reached at 208-542-6757. Follow him on Twitter: @NateBrownNews.

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