Utah Governor Gary Herbert’s Medicaid expansion plan, nicknamed “Healthy Utah,” was amended and passed by the full Senate on February 25, 2015. The amendments reduced the term of the expansion from five years to two. S.B. 164 is sponsored by Republican Senator Brian Shiozawa. After the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) made Medicaid expansion available and mandatory for all states and a subsequent Supreme Court finding in National Federation of Independent Business v Sebelius made expansion optional, about half of the states decided to expand. Others, like Utah, are still trying to pass an expansion bill. Several states began using Section 1115 waivers, previously used for testing new policies under Medicaid, to expand Medicaid in ways not specifically outlined in the ACA.
In general, more conservative states have been resistant to Medicaid expansion due to financial concerns. The national average of those considering themselves religious sits at 49 percent, while 79 percent of Utah citizens consider themselves religious. The majority of those considering themselves religious in Utah, both citizens and state legislators, are part of the Church of Jesus Christ of Latter-day Saints (LDS). Some religious clergy previously united to urge the governor to expand Medicaid coverage, but the absence of LDS leaders illuminated the lack of consensus within the state on the topic. In 2013, Governor Herbert requested information from the state health department regarding expansion options and took his time deciding before moving forward with the Healthy Utah plan.
The state first commissioned a report analyzing five different options of Medicaid expansion. These options ranged from no expansion to full expansion under the ACA to those with incomes up to 138 percent of the federal poverty level (FPL). These five were narrowed down to three: no expansion, expansion to those 100 percent of FPL, and expansion of traditional Medicaid for those at 100 percent of FPL and then using federal funds to provide assistance to those between 100 percent and 138 percent of FPL. This was expanded to include a recommendation for supporting private insurance purchases for the expansion population with incomes up to the FPL (see Utah governor announces Medicaid expansion, January 29, 2014).
So, what’s the plan?
Governor Herbert decided on a Section 1115 waiver proposal that involves a three year block grant. Those eligible will be adults without children with incomes ranging up to 138 percent of the FPL, and those aged 19 to 64, with children and with incomes from 50 to 128 percent of the FPL. The assistance provided to each individual will be based on the following criteria: individual health care needs, household income, ability to work, and access to employer based or family health insurance. Those who receive assistance will be required to pay co-payments, while private insurance options are available for parents with children on Medicaid.
Why this particular plan?
The governor stated that he considers the ACA a policy failure and supports the efforts to repeal it. However, he decided that his state “must deal with the realities of the law” and sought to provide health care for the needy, pointing out that the ACA policies left a gap of about 62,000 Utah citizens making less than $12,000 and no assistance to purchase health care. The governor described four criteria that he sought to meet while providing this much-needed assistance, balancing the interests of those in need of health care coverage and the taxpayers to “work toward the best deal possible.” These criteria involve respecting taxpayers by directing tax money back to the state, supporting private markets by providing financial assistance to allow citizens to purchase of private health insurance as opposed to using the money for federal Medicaid funds, promoting responsibility by including premiums and copays as well as introducing aid recipients to work programs, and maximizing flexibility by limiting it to a three-year program. This three year time span allows the state to evaluate its effectiveness. Provisions are also made for program termination if the federal government restricts promised funding.