Blog Post

Is the tide turning on Medicaid expansion in red states?

September 17, 2013

    Juliette Mullin, Editor

    It's been a good week for HHS Secretary Kathleen Sebelius, who has been working behind the scenes to shore up the Affordable Care Act as it nears a key implementation date.

    Specifically, Sebelius has been lobbying state lawmakers to participate in the ACA's Medicaid expansion, according to Bloomberg News. And after months of resistance, several key Republican governors are reversing their stance on whether to opt in to the once-controversial provision.

    Many observers had expected this; analysts widely agreed that GOP leaders would eventually accept the expansion's federal funds, in hopes of bolstering their states' finances. And the wave of recent news suggests that we may be reaching a tipping point on expansion.

    • Pennsylvania's Tom Corbett on Monday became the 10th Republican governor to support the use of federal Medicaid expansion funds to expand health coverage.
    • On the same day, Michigan Gov. Rick Snyder signed a bill to expand the state's Medicaid program under the ACA, making Michigan the largest Republican-controlled state to sign on to the expansion.
    • And Ohio Gov. John Kasich has restated his intention to push for expansion this fall, after Republican legislators rejected his earlier proposal to expand the program.  

    According to the Washington Post's Sarah Kliff, the two main factors influencing governors' Medicaid decisions are increased federal funding and the federal government's flexibility with Medicaid waivers.

    Corbett changes his tune on coverage expansion

    Earlier this year, Corbett said that Pennsylvania would not participate in the Medicaid expansion but assured residents that he would consider alternatives if the federal government is willing to accept certain modifications in how the state provides Medicaid coverage.

    On Monday, Corbett unveiled a broad ranging health reform package that includes a plan to use federal funds for the ACA's Medicaid expansion to help many residents purchase private coverage.

    The alternative plan is similar to one developed and adopted in Arkansas. Under the so-called private option plan, Arkansas would use three years of federal funding meant for the expansion to pay for private insurance in the exchange. HHS has said that states considering such an option would have to obtain a federal waiver to implement it.

    Under Corbett's plan, as many as 520,000 eligible low-income residents—particularly adults with annual incomes up to 138% of the federal poverty level—would receive subsidies to purchase private coverage through Pennsylvania's federally run insurance exchange.

    In addition, Corbett's reforms would require eligible residents to pay monthly premiums on a sliding scale from $0 to $25. Unemployed residents would be required to prove that they actively are seeking employment in order to receive premium reductions. The proposal also would scale back Medicaid benefits to align them with plans in the private insurance market.

    The prospects for the "Healthy PA" package and the Medicaid plan remain unclear because they are both subject to approval by the state Legislature and the federal government, The Hill's "Healthwatch" reports.

    >> Part of this blog post is adapted from American Health Line, our sister publication. For the full story on Corbett's Medicaid plan, check out americanhealthline.com [subscription required].

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