Michigan Expands Medicaid with Delay; Four States Continue Debate

Most states finalized their decisions whether to expand Medicaid months ago, but the battle continued in Michigan and Pennsylvania, where Republican governors tried to convince their legislatures to put aside their opposition to “Obamacare” and benefit from the additional federal funding available. On September 3, 2013, the state House and Senate agreed to legislation to consent to Governor Rick Snyder’s requesto pass legislation expanding Medicaid. But the Senate bill, to which the House agreed, delayed the expansion until at least April 1, 2014 rather than the first of the year. And the Senate refused to reconsider the delay.

Conditional Expansion

The legislation depends in large part on HHS approval of two waiver requests. The first would  include mandatory managed care and require the managed care organization (MCO) to maintain an account into which payments from the enrollee, his or her employer, or any public or private entity may be deposited in order to pay for the enrollee’s health care expenses, including copayments. The MCO would be required to provide quarterly statements of expenditures from the account and to track enrollees’ copayments. After the first six months, the MCO would require monthly payments, billing enrollees prospectively for the anticipated copayments based on their history. However, all expansion enrollees with incomes between 100 percent and 133 percent of the federal poverty level (FPL) would be expected to contribute at least 2 percent of their annual income. And expansion enrollees who remain on Medicaid for four years would be required to contribute an additional 2 percent of their income.

After enrollment with an MCO, enrollees under Medicaid expansion would be required to schedule an appointment with their primary care practitioner (PCP) within 60 days. They would complete a health risk assessment to identify unhealthy characteristics, such as obesity, tobacco use, substance abuse, or failure to obtain standard immunizations.  MCOs would have discretion to reduce the minimum contribution based on the enrollees’ compliance with the healthy behaviors identified by their PCP based on the assessment.

Michigan’s Medicaid agency, the Department of Community Health (DCH), may not begin enrolling individuals under the expansion until January 1, 2014 or the date the waivers are approved, whichever is later. Thus, even after Governor Snyder signs the legislation, Medicaid expansion will remain uncertain.

The Cost of Delay

According to the Detroit Free Press, DCH Director Jim Haveman says the delay could cost the state $7 million per day. Republicans dispute that amount, stating that it assumes that every eligible individual enrolled immediately. Director Haveman says the true cost will become clear as the law is implemented.

Continuing Debate

According to the Kaiser Family Foundation, New Hampshire, Ohio, Pennsylvania, and Tennessee have not yet determined whether to accept the Medicaid expansion. New Hampshire has established a study committee to consider it, but the legislative session has ended for the year. In Ohio and Pennsylvania, the legislature meets throughout the year, so it is possible that these states could decide to expand by 2014.  In Tennessee, both the governor and the legislature are still weighing the options, but the legislature is out of session.