Don’t call it an expansion, caution supporters of Gov. Tom Corbett’s modified Healthy Pennsylvania plan.
This week’s big announcement on Medicaid in Pennsylvania is being sliced, diced — and interpreted — in different ways.
About 500,000 Pennsylvanians are newly eligible to join the Medicaid program, but the Corbett administration is referring to the agreement between the state and the federal government as a “reform” not an expansion.
“Gov. Corbett really backed down on many of his more controversial requests,” said health policy analyst Joan Alker, who runs the Center for Children and Families at Georgetown University.
That compromise allowed Corbett to strike a deal with the Obama administration.
When the federal government allows a state to bypass or modify certain program requirements, it’s known as a Medicaid “waiver.” Corbett asked for 24 changes and received four.
Instead of directly expanding the state’s Medicaid program, the modified Healthy PA plan — approved by the Obama administration this week — offers federal subsidies to enroll low-income Pennsylvanians in private insurance plans.
Critics are concerned about people getting lost in the shuffle of paperwork, sign-up glitches and the need to move thousands of newly eligible people into new private plans. Enrollment should start in December.
“We have a really short time to make all of that happen, and Pennsylvania has historically had a lot of problems getting its technical systems to talk to each other,” said Kristen Dama, a staff attorney with Community Legal Services in Philadelphia.
‘More rhetoric than reality’
But Alker said the new system isn’t that different from the old.
“Pennsylvania already has private insurers delivering the vast majority of the services in your Medicaid program today, and it’s going to be those same companies that will be providing the services going to this new population, so we’re talking about a lot more rhetoric here than reality,” Alker said.
As shorthand, Pennsylvania is being called the 27th state to expand Medicaid, but the Healthy PA alternative plan is a standout from expanded Medicaid in most states.
Newly eligible people will not pay monthly premiums toward the cost of their health plans in year one.
But starting in 2016, the state can charger premiums for adults with incomes more than 100 percent of the poverty level.
Because Medicaid accounts for about 29 percent of Pennsylvania’s general fund spending, Corbett has argued that people in the program need to help shoulder more of the cost of their health care.
Monthly premium payments could be about $20 or $25 for someone earning $12,000 a year — but not more than 2 percent of income.
Alker said those premium payments will be similar to those paid by people who buy their insurance through the Obamacare marketplace under the Affordable Care Act.
Dama said the premiums are a bad idea.
“There’s just an enormous body of social science research that shows that when you have very low-income people, like people in Medicaid, and you impose premiums, all it really does is knock people of the program,” she said.
Under the federal agreement, people who miss a premium payment will have a grace period before they are ejected from the program; when they are ready to re-enroll, there will be no waiting period required.
A ‘no’ on the requested work-search contingency
“As expected, the Obama administration said you cannot link work search or work requirements to Medicaid,” Alker said. “Medicaid, it’s a health care program, not a jobs program.”
Yet, the language in the waiver announcements from the Corbett and Obama administrations seem to be at odds.
The explainer from the Centers for Medicare and Medicaid Services Administrator Marilyn Tavenner states:
“Work requirements and incentives are not approved as part of this waiver. The state plans to fund and administer a separate program to link people gaining coverage under the waiver to job training and placement services for those who choose to participate. Health coverage will not be affected.”
The language from the Corbett news release reads differently. It seems to leave open the suggestion Medicaid costs could be reduced for people who participate in a new program called “Encouraging Employment” – which will be set up with state funds, not federal dollars.
That statement said: “Medicaid participants and Healthy PA PCO enrollees will be able to reduce their health care cost-sharing obligations through job training and work-related activities, with each participant receiving assistance to do so from a Healthy PA Career Coach.”