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Recent State Action Relating to Medicaid Expansion

September 12, 2019

McDermott+Consulting

To date, 37 states (including DC) have adopted Medicaid expansion. Of the remaining 14 states, some are considering expanding Medicaid. States with recent activity relating to Medicaid expansion include Idaho, Montana, Nebraska, North Carolina and Utah. California is also exploring expanding Medicaid to undocumented adults. Below we have highlighted recent state grassroots, legislative and executive action to expand Medicaid.

States Implementing Medicaid Expansion

Idaho

In November of 2018, voters passed Proposition 2 by ballot measure to expand Medicaid, which will effect approximately 78,000 Idahoans.

After passing Proposition 2, the state of Idaho added a new section to its insurance statues.  Section 56-267 codes Medicaid expansion into Idaho law as intended by the ballot measure.  Soon after, state Republican lawmaker Brent Regan filed a lawsuit against the state claiming that section 56-267 was unconstitutional. On January 29, 2019 the Idaho Supreme Court heard oral arguments on the case.  The court ruled that section 56-267 was constitutional and does not give excessive authority to the Department of Health and Welfare or the federal government.

In February 2019, Idaho submitted a state plan amendment (SPA) to implement Medicaid expansion. Following that, state lawmakers signed and enacted S.1204 into law, which moved the state forward with expansion and added several provisions including a work/community engagement requirement in which able-bodied enrollees are required to spend at least 20 hours a week in work, school or community events. A clause is also included that allows individuals with an income between 100-138% of the federal poverty line to continue to receive premium subsidies in order to buy coverage on the state exchange instead of being covered by Medicaid.  Idaho is also looking to implement a health risk assessment surrounding substance use disorders.  These data would be used to refer enrollees to substance abuse treatment options and would not be used to restrict access to Medicaid coverage. The state would also like to use Medicaid managed care for all expansions enrollees.  Idaho needs federal approval through an 1115 waiver to implement these program designs.

As of August 1, 2019, Idaho has not yet submitted an 1115 waiver to the Centers for Medicare and Medicaid Services (CMS), but is expected to do so in the near future.  Expansion enrollment is set to begin in November 2019 with coverage beginning January 2020.

Nebraska

In November of 2018, voters passed Nebraska Initiative 427 by ballot measure to expand Medicaid.  This is anticipated to affect 90,000 Nebraskans.

On April 1, 2018, the Nebraska Department of Health and Human Services unveiled the details surrounding their Medicaid expansion proposal and submitted amendments to the federal government.  Nebraska’s plan includes adding the ‘Heritage Health Adult Program’ to the current state Medicaid model, which all newly eligible adults will be enrolled in.  This program includes three tiers of coverage – basic, prime, and medically frail.  The ‘basic’ coverage tier is modeled after the Blue Cross Blue Shield Pride plan, and all residents who are eligible for expanded Medicaid will automatically qualify for this basic coverage.  The ‘prime’ coverage tier will cover services such as dental, vision and over-the-counter drugs.  Individuals will be eligible for prime coverage in year one if they select a primary care provider, attend an annual physical and participate in care and case management.   Beginning in year two, eligible enrollees will also have to adhere to a work requirement (80 hours per month) in order to maintain eligible status for prime coverage.   Meanwhile, individuals who Nebraska Medicaid determine to be medically frail will fall under the ‘medically frail’ tier and be enrolled in the Heritage Health Adult Program and will receive all state plan services.

While Nebraska  submitted their SPA and an overview of their proposal to CMS on April 1, 2019, they have yet to submit an 1115 waiver proposal to implement the work requirement provisions of the expansion.  Expansion enrollment is set to begin in August 2020.  Expansion coverage will begin in October 2020.  However, a consumer protection group in Nebraska is suing state officials to move up the enrollment date, arguing that the state is violating the terms of the ballot measure by not taking advantage of the enhanced federal Medicaid matching funds granted in the Affordable Care Act (ACA).

Utah

On March 6, 2018, the Utah state legislature passed H.B. 472.  This bill required the state to submit an 1115 waiver to CMS by January 1, 2019, requesting approval for partial Medicaid expansion.  Later in 2018, voters passed the Utah Medicaid Expansion Initiative by ballot measure.  This initiative called for Medicaid full expansion as outlined in the ACA, by April 2019.

On February 11, 2019, the Utah state legislature passed, signed and enacted S.B. 96 which reiterated the call for partial Medicaid expansion as outlined in H.B. 472.  On March 29, 2019, CMS approved a Utah 1115 waiver, which implemented a partial Medicaid expansion, Medicaid work requirements, and waived the Medicaid institution for mental disease  exclusion.  The expansion went into effect on April 1, 2019. Following that, on July 31, 2019, the state formally submitted this wavier application to CMS. Provisions of the waiver include implementing a per capita cap, and seeking enhanced Federal Medical Assistance Percentages (FMAP) for the state’s partial Medicaid expansion.

However, by the end of July 2019, Utah had been notified that CMS would not approve enhanced FMAP for partial expansion, in keeping with existing policy. Following the denial, in accordance with S.B. 96, the governor’s office and state lawmakers will begin working on a ‘fallback’ waiver.  The fallback plan is intended to cover residents of Utah up to 138 percent of the federal poverty line at an increased FAMP of 90 percent.  As directed by S.B. 96, the waiver will also request approval to implement a work/community engagement requirement, a lockout provision for program violations, mandatory enrollment in employer sponsored insurance and a per capita cap.

It is estimated that nearly 34,000 Utah residents have been covered by Medicaid expansion.  It is further estimated that a total of 150,000 Utah residents could be covered if the state fully expanded Medicaid.

States with Recent Changes to Their Medicaid Expansion Program

California

On July 9, 2019, California Governor Gavin Newsom (D) signed a bill into law that awarded low-income adults under the age of 26 Medicaid eligibility regardless of immigration status.  This eligibility will begin January 2020 and is part of a broader health care package.

The signed law approves $98 million dollars to expand Med-Cali to income eligible undocumented young adults in California.  Eligible beneficiaries will have access to a health plan that covers doctor visits, dental visits and prescription drug coverage.  California must use their own state dollars to pay for expanding benefits to undocumented residents. California became the first state to cover undocumented residents through the Medicaid program.

It is estimated that nearly 138,000 young adults will be newly eligible for Med-Cali under the new legislation.

Montana

On April 18, 2019, Montana’s state legislature passed the Medicaid Reform and Integrity Act, which continues the states’ Medicaid expansion through 2025, but with significant changes.  These changes include the addition of a work requirement and raising premiums for beneficiaries.  This action comes after Montana voters rejected a measure that would have financed Medicaid expansion in the future through higher taxes on tobacco products.

On August 30, 2019, as required by the approved legislation, the state of Montana submitted a new 1115 waiver to CMS requesting approval to amend and extend the state’s current demonstration.

Considering Medicaid Expansion

North Carolina

In April of 2019, North Carolina’s state legislature introduced H.655, which if passed, would expand Medicaid.  The legislation includes a work requirement, mandatory participation in a wellness program and premiums equal to 2 percent of an individual’s household income. H.655 currently has bipartisan support with both Republican and Democratic co-sponsors.  However, as of May 2019, the bill has remained in committee.

Governor Roy Cooper (D) has included the bill in his yearly budget proposal.

In March 2019, S.387 was introduced in the state Senate.  The bill calls for a work requirement for the existing Medicaid population, but does neglects to expand Medicaid eligibility.  This bill has remained in committee since March 2019.

It is estimated that an additional 624,000 people would be covered if the state expanded Medicaid.

Georgia

In March 2019, the Georgia state legislature passed S.B. 106.  This bill granted the governor’s office new authority to pursue 1115 waiver programs that could lead to Medicaid expansion.

Reports suggest that Governor Brian Kemp (R) is planning a waiver request that would include limited Medicaid expansion.  The state is expected to request enhanced FMAP for the partial expansion, a request CMS previously rejected for Utah. It is unlike Georgia’s request would be approved.

It is estimated that an additional 698,000 people would be covered if the state expanded Medicaid.

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