Manatt on Medicaid: Monthly Expansion Recap

Arkansas

Governor Proposes Changes to Medicaid Expansion Waiver as House Passes Bill to Cap Expansion Enrollment

Governor Asa Hutchinson (R) released a proposal to amend the State's Medicaid expansion waiver by lowering income eligibility for the expansion population from 138% of FPL to 100% of FPL, instituting work requirements, and modifying the State's employer-sponsored insurance premium assistance program to target expansion adults with incomes between 75% and 100% of FPL who work for small employers. The State plans to post the waiver amendment for public comment by April 15 and submit the amendment for CMS review by June 1, 2017 with a request that the new requirements go into effect on January 1, 2018. Meanwhile, The Arkansas House of Representatives passed by a 55-32 margin a bill that would prohibit new enrollment into the State's Medicaid expansion demonstration, beginning July 1, 2017. The bill now advances to the Senate for consideration. Governor Hutchinson opposes the bill and instead plans to hold a special legislative session to address his proposal, according to the Arkansas Democrat-Gazette.

Kansas

Governor Vetoes Medicaid Expansion Bill

Governor Sam Brownback (R) vetoed a bill to expand the State's Medicaid program, citing a lack of work requirements and saying the bill "burdens the state budget with unrestrainable entitlement costs." Both the House and Senate are currently short of enough votes to override the veto.

Kentucky

Report Details Impact of Expansion and Other ACA Provisions on Coverage and Access

The uninsured rate dropped from 13.6% in 2012 to 6.1% in 2015, the second-largest decline in the country behind West Virginia, according to a report published by the Foundation for a Healthy Kentucky. Since implementing Medicaid expansion, Kentucky's Medicaid enrollment of non-elderly adults increased by 73%, with adults ages 26-34 representing the largest group of enrollees. Individual market coverage also increased significantly since 2012 and fewer Kentuckians cited delayed or skipped healthcare due to cost. The report also includes additional findings on access to care, cost, and quality by demographic categories, including race, ethnicity, age, and income.

Montana

Report Details Implications of Medicaid Expansion Repeal

Repealing Medicaid expansion could lead to the loss of coverage for more than 71,000 Montanans, the loss of $284 million in federal funding, and increases in hospital uncompensated care, which declined by 25% with expansion, according to a report prepared by Manatt Health and funded by the Montana Healthcare Foundation. Repeal would also put at risk gains in treatment of substance use disorders and mental health, access to care and specialty services for American Indians, and former inmates' access to coverage and care.

North Carolina

Governor Cooper Restates Support for Medicaid Expansion in First Budget Release

Governor Roy Cooper's (D) FY 2017–2019 budget includes Medicaid expansion, and proposes to cover the State's share of expansion costs through provider contributions rather than general fund appropriations. The North Carolina Hospital Association indicated that hospitals are prepared to work with the Governor, Legislature and members of Congress on expansion.

National News and Reports

House Speaker Ryan Pulls AHCA Minutes Before Vote, Calls the ACA "the Law of the Land"

House Speaker Paul Ryan (R-WI) pulled the American Health Care Act (AHCA) from the House floor minutes before its scheduled vote on Friday, following a number of defections from the House's Republican conference. The bill would have eliminated enhanced federal funding for the Medicaid expansion population, which would have contributed to 14 million fewer Medicaid enrollees by 2026 relative to the ACA, according to the Congressional Budget Office (CBO), and which some moderate Republicans worried would hurt low-income Americans. In total, the CBO projected that the AHCA would increase the number of uninsured by 24 million by 2026 and cut $880 billion in federal Medicaid spending (a 25% reduction). Earlier in the month, Senators Rob Portman (R-OH), Shelley Moore Capito (R-WV), Cory Gardner (R-CO), and Lisa Murkowski (R-AK) sent a letter to Senate Majority Leader Mitch McConnell (R-KY) saying that they would not support a repeal plan "that does not include stability for Medicaid expansion populations." After pulling the bill, Speaker Ryan said the ACA will remain in place "for the foreseeable future," though in more recent days he suggested that the House might be returning to a debate on the ACA in the current congressional session.

State-by-State Analysis Estimates AHCA's Impact on Medicaid Expansion Coverage and Federal Expenditures

A Manatt Health analysis estimated that the American Health Care Act's proposal to phase-out federal Medicaid expansion funding would have resulted in 14 million people losing coverage by 2024 and the 31 expansion states plus the District of Columbia losing approximately one-third of their total Medicaid funding by 2026. The state-by-state analysis found that some Medicaid expansion states, including Kentucky, Montana, Oregon, and Washington, could have experienced more than a 40% reduction in federal Medicaid funding each if the bill had passed. The analysis assumes states would have continued coverage just for those Medicaid beneficiaries for whom enhanced matching funds are available.

Implementing Work Requirements Would Create Operational Challenges for States

A Kaiser Family Foundation brief suggests that implementing work requirements as a condition of Medicaid eligibility would create an administrative burden for states, though such a requirement would likely apply to only a small number of people. While CMS has not previously approved any state requests to implement work requirements, Arizona and Kentucky have recently submitted 1115 expansion waiver requests that include work requirements and the Trump Administration has signaled it may approve such requests. According to the brief, nearly 60% of adults enrolled in Medicaid work and nearly 80% have a household member that works.

HHS Pledges to Allow States Additional Waiver Flexibility

HHS sent a letter to governors pledging to provide states with enhanced flexibility in their Medicaid programs, including for expansion waivers. In a March 10 letter, Secretary Tom Price and CMS Administrator Seema Verma described a "new era" of state flexibility through expanded "fast-track" waiver approvals; a wider range of program options under 1115 waivers, including work requirements, cost-sharing, premiums, and health savings account-like features; and a review of managed care regulations.