Bookmark and Share

March 2014 St@teside

The Latest Medicaid Expansion Developments

Whether states should pursue approval of the expansion of Medicaid continues to be a prominent issue in many current state legislative sessions. States can opt for Medicaid expansion at any time and receive the 100 percent federal match for newly eligible Medicaid enrollees through 2016, after which the match will gradually decrease to 90 percent in 2020. With the Department of Health and Human Services’ willingness to explore alternative Medicaid expansion plans, there has been a surge in states trying to pass such plans. Below is an overview of the states that have recently moved forward with Medicaid expansion, states that have submitted waivers to Centers for Medicare & Medicaid Services (CMS) for Medicaid expansion, and states that are having ongoing expansion debates.

States moving forward with Medicaid expansion:

  • Arkansas: Arkansas led the way in alternative Medicaid expansion options when CMS approved its 1115 Medicaid waiver in 2013, thereby establishing the Health Care Independence Program. This program, also known as the Private Option, uses Medicaid dollars to pay for the private health insurance premiums for individuals up to 138 percent of the federal poverty level (FPL). Since the program began, more than 100,000 people enrolled. However, the program was in jeopardy as the legislature had to approve an appropriation to continue to accept federal funds for the program past the end of this fiscal year. After five votes in the Arkansas House of Representatives, funding to continue the program was passed.
  • Michigan: In December 2013, CMS approved Michigan’s waiver for the Healthy Michigan Plan. This program will expand Medicaid to individuals who have incomes up to 138 percent FPL, and the program is set to begin in April 2014. The waiver allows the implementation of some new elements, including required co-pays and income-based premiums that recipients can reduce by making healthy lifestyle choices.

States with pending waivers:

  • Indiana: In April 2013, Indiana submitted a waiver to extend the Healthy Indiana Plan – a program offering adults with incomes between 100 percent and 200 percent FPL subsidized coverage – in order to allow individuals who were previously denied enrollment due to limited funds into the program. While the waiver is still pending, Governor Mike Pence continues to discuss this plan with HHS.
  • Pennsylvania: Following Arkansas’s lead, Pennsylvania Governor Tom Corbett submitted an 1115 waiver seeking to use federal dollars to subsidize premiums of low-income adults enrolled in private insurance. However, Governor Corbett’s plan differs from Arkansas in a few key ways. It proposes changes to benefit packages for all Medicaid recipients, requiring premiums for any Medicaid enrollee above the poverty line. The waiver also includes a proposal to start a pilot program that would offer discounts on premiums and co-pays for individuals who participate in a job training program.

States with ongoing expansion debates:

  • Maine: This month, both the House and Senate passed a bill to enact traditional Medicaid expansion and establish a managed-care program. While Governor Paul LePage is certain to veto the bill, it still remains to be seen whether the Senate and House will have enough votes to override the veto.
  • Missouri: Republicans in the House have filed a bill to enact a Medicaid expansion program similar to the program that Pennsylvania has proposed. However, the bill would require that working-age Medicaid enrollees have a job or be in school. 
  • New Hampshire: On March 25 after ongoing debates, New Hampshire’s legislature voted to expand Medicaid through a private option plan similar to that of Arkansas, and Governor Maggie Hassan signed the bill on March 27. However, New Hampshire still needs to get federal approval for its expansion plan.
  • Utah: Governor Gary Herbert is also pursuing an alternative Medicaid expansion plan that would use block grants from HHS to provide subsidies for individuals who earn up to 138 percent of the FPL. While there are concerns about whether the Utah legislature will approve this plan, Governor Herbert continues to explore his waiver options with HHS.
  • Virginia: With Governor Terry McAuliffe taking the reins in January 2014, expanding Medicaid became one of his top priorities and it was included in the state budget. However, Virginia’s General Assembly adjourned on March 8 without passing a budget or Medicaid expansion. With the reconvening of the legislature for a special session beginning on March 24, Governor McAuliffe proposed a two-year pilot program for traditional Medicaid expansion. However, the House and Senate continue to debate the budget and Medicaid expansion.

For the complete list of states’ Medicaid expansion decisions, check out the Kaiser Family Foundation’s website.