WV Medicaid expansion to be ready mid-2014 - Business, Government Legal News from throughout WV

WV Medicaid expansion to be ready mid-2014

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With Gov. Earl Ray Tomblin's decision to expand Medicaid, many West Virginians could be part of that change in coverage when that it takes effect at the beginning of next year.

However, those opposed to the new expansion question whether the federal government or the state will be able to afford it.

Medicaid expansion comes from the Affordable Care Act, passed in 2010. The act originally mandated all states to expand Medicaid, but the U.S. Supreme Court struck it down.

According to the Washington Post, 20 states and the District of Columbia have expanded Medicaid and 14 are planning to reject it.

Who is covered

Jill Cranston Rice, partner at Dinsmore & Shohl's Morgantown office, said Medicaid expansion will "fill in some current gaps in coverage." The American Public Health Association explains it will extend coverage to residents up to 133 percent of the federal poverty level "but the law also calls for a new methodology of calculating income, which will make the effective minimum threshold 138 percent."

"Now, instead of a variety of different income disregards, there will be one standard disregard for most populations: 5 percent," the site continued. "That means that a person's income can be up to 138 percent (of the federal poverty level), but since 5 percent of her income will be ignored, she will effectively meet the 133 percent threshold."

According to healthcare.gov, 133 percent of the federal poverty level would be approximately $14,000 for a single person and $30,000 for a family of four.

At 138 percent, that would be about $15,000 for a single person and $31,000 for a family of four. 

Currently, the American Public Health Association explains, a single person must earn $5,585 and a family of four must earn $11,525 a year to qualify.

"The family income is probably the average West Virginia income," Rice said. "It takes it all to the cost debate. When you think about it, that's why this is so unprecedented. That's $5.2 bill under the federal government. Never before have we had this type of funding by the federal government. Right now, it's less than 55 percent in Medicaid funding from the federal government and at least through 2016, we will receive 100 percent funding for new expanded coverage for these new enrollees."

What it will do

Mitch Collins, director of Medicaid field operations at UniCare Health Plan of West Virginia, said this could help working families who are stuck in the middle. His organization, which has operated in West Virginia since 2003, serves a little less than half of the current Medicaid population.

"They can't afford private insurance and their income isn't what they can afford to buy employer insurance," Collins said, later adding, "Today, this group that has no insurance predominately go to the emergency room. This will give them the opportunity for preventative coverage."

Rice explained that in West Virginia's plan to expand Medicaid, it will help encourage people to Medicaid managed care system so that we can take advantage of the systems in place, such as managed care systems.

"Managed enroll care is a more cost effective way, using Mitch's example, so you're not going to the emergency room."

So who might benefit from Medicaid expansion? Rice said many people from different sectors, especially tourism, hospitality and agriculture.

"They might not have been year-round full-time workers under the law and not have been eligible for Medicaid before," Rice said. "For some folks, like those making minimum wage, that might be a situation where … there is a gap of a number of individuals who make too much to afford private insurance but don't make enough to afford private insurance but too much to qualify for Medicaid coverage."

"And now, people have a few options," Rice continued. "You can get health insurance from employers, go to the exchanges opening up in West Virginia and the opportunity for Medicaid expansion for other groups of eligible beneficiaries."

In a previous interview, Bill Freedman, a partner out of Cincinnati's Dinsmore office, said Medicaid is the single largest budget item in 49 states and the act would allow the federal government to pay a majority of costs for a fixed number of years.

What remains

However, states would be left to pick up the burden after that time limit expires. Not only that, Freedman said, Medicare eligibility would be expanded to include anyone whose incomes is less than 130 percent of the federal poverty level. Currently, only those who are disabled or earn less than 150 percent of the federal poverty level are eligible for Medicare.

Some state leaders are concerned about the total cost, which they estimate to be $375.5 million from the 2014 fiscal year through 2023.

In a handout state officials passed out at the May 2 Medicaid expansion announcement they said the state's share will be about $5 million a year in the first three years.

However, by 2020, the state share increases to $65 million, so state officials say West Virginia must "find secure, long term funding streams" for that portion of the expansion cost.

Yet, some question whether the state and federal government will be able to foot the bill.

"There is some skepticism there," Rice said. "That's what detractors of the governor's announcement are focused on."

West Virginia Attorney General Patrick Morrisey also expressed concerns about the expansion.

"As someone who participated in the legal and legislative efforts to overturn this law, I am deeply concerned that Obamacare and this expansion will have a very negative impact on economic growth in our state and nation," Morrisey said. "That's not what we need as federal spending slows down and places even greater pressure on West Virginia to kick start economic growth."

Preparing now

Morrisey additionally said paying for the expansion could be difficult.

"While paying for the state's portion of this expansion will be daunting enough today, does anyone really believe that the federal government will maintain its same level of Medicaid funding in the future when it is staring at a $16 trillion debt and desperately needs to reduce spending?  The federal matching rate for existing West Virginia Medicaid payments has been dropping in recent years as the infusion of monies from the stimulus law went away.  Why do we expect that the federal government will maintain a 90 percent matching rate?"

So how is the West Virginia Department of Health and Human Resources preparing for this expansion? DHHR cabinet secretary Rocco Fucillo said his staff has started to meet daily to create an implementation plan before Tomblin's announcement. 

DHHR already has offices in every county except for a shared office for Brooke and Hancock counties in the Northern Panhandle, so Fucillo said a network for outreach is already in place.

Nancy Adkins with DHHR said enrollment will open in October, and the public will need to apply to see what they qualify for, and everything will need to be up and running by June 1.

Both Fucillo and Adkins said they will be ready by that deadline.

Fucillo said the recent audit of DHHR by Public Works looked at the DHHR over a number of years, and he's only been appointed its chief since July 1 but he welcomes the audit.

He said Tomblin's staff gave his office every opportunity to analyze the report, and he's looking forward to addressing the recommendations in the audit.

Fucillo pointed out that the white paper he created with his vision for the office when he was named to the position has several of the same recommendations the audit made.

"This is an opportunity to make good changes for the state of West Virginia," Fucillo said. 

 

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