Want to know what's happening next in healthcare?

MedCityNews is the leading online news source for the business of innovation in healthcare.


“I read MedCity because it captures the pulse of what's going on in healthcare innovation, a go to source. I also like how MedCity supports women in digital health.”

Dr. Charlene Ngamwajasat, @doctorcharlene, Physician and techie


Sign up for our daily newsletter


Washington state building insurance exchange but still debating Medicaid expansion

January 27, 2013 3:00 am by | 0 Comments

Maine tries free market health insurance system

OLYMPIA, WA - Washington officials are moving ahead quickly to set up a new health insurance marketplace where the uninsured can start buying health plans later this year. But one other major element of Obamacare -- the expansion of Medicaid to cover more of the state's poorest people -- is high-centered in the Legislature.

About 250,000 low-income adults in the Evergreen State would become eligible for coverage under the Affordable Care Act if Washington chooses to fully expand the program.

The expansion is one of the changes prompted by the federal health care reform that could eventually get care to more than 800,000 of the state's 1.1 million uninsured, state Insurance Commissioner Mike Kreidler said.

The extra coverage comes at federal expense for the first three years and in the early years Washington comes out ahead. But some Republicans worry that the state will be saddled with a hefty bill in later years as federal budgets shrink.

Advertisement

The Medicaid debate is happening as Washington's Health Benefit Exchange is moving ahead.

The exchange, which is a marketplace for policies that would give families a choice of private health plans similar to what workers at major companies already are offered, starts signing up consumers to buy private health-insurance policies starting Oct. 1.

"We've got a lot to do" before then, Richard Onizuka, chief executive officer for the Health Benefit Exchange, said Friday in an interview. But he said he is confident the new exchange entity can hit its target dates for approving eligible health plans, starting a call center for consumers and informing the public of the big changes that lie ahead.

Just last week, the exchange moved to a new website separate from the state's Health Care Authority where it began life. The exchange's staff is getting new email addresses this week, marking the final break between government and the new private agency that will operate in part with public dollars.

Like the Medicaid expansion, the exchange also is dogged by concerns about costs, with some lawmakers questioning its $50 million a year budget.

When state lawmakers set up the exchange in 2012, they gave its 11-member governing board the ability to levy a premium fee on insurers that take part. The Association of Washington Business and other business advocates have raised questions publicly about the impacts of such a fee on insurers and consumers.

Onizuka said last week that a 4 percent fee, worth $13.69 per policy per month, would raise enough money to cover the exchange's budget once the federal start-up grant runs out in 2015.

Or the exchange could tap the $26 million yearly windfall that the state expects to receive from an existing premium tax once more people buy insurance, he said. That would allow the premium surcharge to be cut in half.

Onizuka anticipates that 130,000 of the state's 1.1 million uninsured residents will use the exchange in the last quarter of the year, giving them insurance coverage effective Jan. 1 next year. And the number of enrollees could grow to 343,750 by the end of 2015 as more consumers take advantage of the system.

The exchange also can route Medicaid-eligible consumers into that program instead.

Currently, Medicaid excludes single adults, focusing only on those who are elderly, disabled and who have kids. But the expansion would allow single adults to qualify with incomes of up to $15,000 a year, or about 138 percent of the federal poverty line.

Under Obamacare, the federal government is covering costs for all people who become newly eligible for Medicaid in 2014-15. The state share would rise after that, topping out at 10 percent of costs in 2020.

But some Republicans and their allies in the Legislature worry that the state might be saddled with a hefty bill in later years.

"We're still early in the budget process trying to figure out the dynamics of that. Let's face it: They're broke back in D.C. and if people think this 90-10 split is going to go in perpetuity, the dollars just aren't there," Sen. Rodney Tom, a Democrat who leads the mostly Republican governing coalition in the Senate, told reporters late last week. "And so what happens if that goes to a 50-50 or they pull the rug entirely?"

House Republican Leader Richard DeBolt of Chehalis said the Senate's Republican budget writer, Andy Hill, and the House GOP's budget writer, Gary Alexander, "are looking at it from all angles and what guarantees we can get, and are there offramps in it that allow us to move out of the program if the federal government doesn't meet their obligations."

But Kreidler, Democratic lawmakers like Rep. Dawn Morrell of Puyallup and a coalition of groups, such as the AARP and the Washington State Hospital Association, see Medicaid expansion as a no-lose proposition, at least in the short-term.

That is because the state gets a net gain of funding in the first biennium -- including higher federal support for the working poor on the Basic Health Plan and unemployable adults on Disability Lifeline -- if the Medicaid population is expanded to include adults who are poor, without kids and not disabled.

In the short term, the Affordable Care Act saves the state $140 million if Medicaid is expanded, according to state budget estimates.

Morrell, chairwoman of the House Appropriations Subcommittee on Health and Human Services, thinks the savings could be even more than that.

She says the fiscal realities are sinking in on lawmakers, some of whom are still shifting from their campaign stances attacking Obamacare as they learn more about coverage for poor people in their districts.

"I think we have to get past the rhetoric and to the plain facts," Morrell said. "I don't even say 'if' we do this. I say 'when' we do this. ... I look at it as it's the right thing to do.''

Gov. Jay Inslee voted for federal health care reform as a congressman in 2010 and favors the full expansion of the program. The Medicaid expansion would have been automatic under the Affordable Care Act until the U.S. Supreme Court struck down the requirement that states do it.

If the state chooses not to expand Medicaid, the people left uncovered likely will do what they've been doing, according to Onizuka, which often is to show up at hospital emergency rooms where the costs of care are much higher.

Insurance Commissioner Kreidler's office estimated in a report last May that the uninsured pass on their costs to the insured to the tune of $1,017 a year per insured family on average.

The Washington State Hospital Association is warning lawmakers that the viability of hospitals will be at risk if Medicaid is not expanded. The ACA reform cuts Washington hospitals' reimbursements in several programs by $3.1 billion over the next 10 years -- cuts that take effect and have a serious impact on hospitals' budgets whether the state expands Medicaid or not.

Senate Health Care Committee chair Randi Becker, a Republican whose district overlaps rural areas of Thurston and Pierce counties, hasn't signed on for expanding Medicaid but is looking at it.

"At the end of the day, the Affordable Care Act is the law of the land and it's up to us to implement it in the best way possible," Becker said in an email Friday. "That's why you're hearing us ask so many questions."

ONLINE

For more information about the state's health care exchange, go to wahbexchange.org and wahealthplanfinder.org.

Jordan Schrader contributed to this report. Brad Shannon: 360-753-1688 [email protected] theolympian.com/politicsblog @BradShannon2 ___

Copyright 2014 MedCity News. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

By SHANNON, BRAD

Visit website | More posts by Author

0 comments

Hear the latest news first

Get our daily newsletter or follow us.

Advertisement