States’ Decisions on Medicaid Expansion Still Unfolding

Two months ago we discussed Medicaid eligibility in our blog post,  “Who Will be Eligible for Medicaid in January 2014?“. State decisions on whether to move forward with Medicaid expansion are a work in progress; back in May, there were 30 states, including D.C., that were in support of the expansion, 15 states that were not, and 6 states still deciding.

Where do states stand now? (click on the table for an expanded view).

At this time, 25 states will go forward, 20 will not, and 6 are still deciding.¹ (Since this Kaiser Family Foundation report, Michigan has passed Medicaid Expansion – see note in Sources). States that have now decided not to move forward with Medicaid expansion starting January 1, 2014, include Utah, Kansas, Montana, Missouri, Florida and Maine. New Hampshire and Ohio have gone from “in support” to “debate ongoing”.

These states are not moving forward due to perceptions that the full impact of Medicaid expansion has not yet been adequately assessed and that alternative models may be better.  Despite this, supporters in these states continue to push for Medicaid expansion as states may expand their programs later on. However, states that don’t move forward now will lose out on full federal funding of the program, which continues for three years after it begins in 2014. After 2017, federal funding will begin to gradually decline until it reaches 90% for 2022, with states shouldering the remaining 10%. Beyond 2022, federal funding is not to go below 90%.²

Here’s what’s happening in each state that has changed its standing:

NEW HAMPSHIRE (Supported in May 2013 → Still debating in August 2013)

New Hampshire initially showed support for the measure but the decision has been stalled by disagreement between the Democratic House and Republican Senate. A committee has been established to study the issue and is expected to give a recommendation by October 15.³

OHIO (Supported in May 2013 → Still debating in August 2013)

Ohio Gov. John Kasich (R) has long been in support of the measure but met with resistance from GOP lawmakers. Most recently, state legislators have been scrutinizing MetroHealth, a Cleveland-based public health system that received federal approval in February 2013 for their Medicaid waiver program called MetroHealth Care Plus.Despite the program’s early success, legislators are doubtful that state Medicaid expansion would have similarly positive results.⁴

UTAH (Undecided in May 2013 → Not moving forward in August 2013)

Gov. Gary Herbert (R) has put off his decision until next year, citing concerns about how much the state will have to spend to expand its program.⁵

KANSAS (Undecided in May 2013 → Not moving forward in August 2013)

The Kansas legislature has gone from “still deciding” to postponing a decision on Medicaid expansion. Along with Obamacare opponent Gov. Sam Brownback (R), legislators are concerned that the federal government will decide to shift more of the program costs to states down the line in addition to the 10% the state would pay after 2022.^6,7

MISSOURI (Supported in May 2013 → Not moving forward in August 2013)

Missouri has decided not to go forward with Medicaid expansion this year as Republican legislators believe that Missouri’s Medicaid system is ‘broken’.  Like some other states that have not gone ahead, lawmakers will further examine the program and explore alternative options in the 3 committees that have been set up to study the issue.⁶

FLORIDA (Supported in May 2013 → Not moving forward in August 2013)

Florida will not move forward with Medicaid expansion as its House and Senate remained divided by the end of the state’s regular legislative session on May 3, 2013. The Senate was in support of expansion, while House Republicans pushed for an alternate plan that would use $300 million of state money to purchase basic coverage for 130,000 low-income residents.⁸

MAINE (Undecided in May 2013 → Not moving forward in 2013)

House Democrats failed to override Gov. Paul LePage’s(R) veto of the bill calling for Medicaid expansion. Opponents of Medicaid expansion say that more time is needed before making a decision, and that the federal government’s January 1, 2014 date puts a false sense of urgency on states to make a decision.⁹

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States are allowed to opt-in to Medicaid expansion at any time. This flexibility indicates that there’s still a chance that some of these states will change course, as was just seen in Michigan, which passed Medicaid expansion  on Wednesday, August 28, 2013.¹⁰ However, states that don’t do so by January 1, 2014 stand to lose billions of dollars in federal funding as it becomes available.

How will the ongoing changes in state Medicaid expansion affect healthcare manufacturers? We’ll explore that in our next blog entry.

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Sources:

1. http://kff.org/medicaid/state-indicator/state-activity-around-expanding-medicaid-under-the-affordable-care-act/#map

2. http://www.cbpp.org/files/status-of-the-ACA-medicaid-expansion-after-supreme-court-ruling.pdf

3. http://www.concordmonitor.com/news/8188947-95/nh-medical-providers-unite-in-support-of-medicaid-expansion

4. http://www.cleveland.com/healthfit/index.ssf/2013/02/clevelands_metrohealth_gets_ok.html

5. http://www.sltrib.com/sltrib/news/56769473-78/utah-medicaid-expansion-herbert.html.csp

6. http://www.advisory.com/Daily-Briefing/Resources/Primers/MedicaidMap

7. http://www.kansascity.com/2013/06/24/4310837/medicaid-expansion-dead-in-missouri.html

8.http://www.miamiherald.com/2013/07/24/3519595/feds-to-florida-not-too-late-for.html

9. http://bangordailynews.com/2013/06/19/politics/maine-house-fails-to-override-medicaid-expansion-veto/

10. Note: On Wednesday August 27, 2013, Michigan passed Medicaid expansion, and the numbers above reflect this change: http://www.freep.com/article/20130827/NEWS06/308270106/Medicaid-expansion-michigan-vote-affordable-care-act

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