With recent governors’ elections in Kentucky and Louisiana refocusing attention on state Medicaid expansion decisions, the Kaiser Family Foundation has published an overview of the waivers obtained by six states, and planning now underway in other states.
Arkansas, Iowa, Michigan, Indiana, New Hampshire and Montana are currently pursuing alternative Medicaid expansions under the Affordable Care Act.
Medicaid plays a key role in the ACA’s goal of reducing the number of uninsured by expanding eligibility to nearly all low income adults with incomes at or below 138% of the federal poverty level (FPL), which this year is $16,242 per year for an individual. The federal government covers the full cost to the states of this expansion for the first three years; this gradually decreases to 90%.
A Supreme Court ruling made the expansion a state option. Currently 30 states and the District of Columbia have adopted the expansion.
In addition, several states have obtained or are seeking approval from the Centers for Medicare and Medicaid Services (CMS) to implement their expansions in ways other than those provided by the ACA. This is possible through waivers available under Section 1115 under the Social Security Act.
The Kaiser study looked at the role of waivers in expanding coverage, as well as provisions proposed by the states that federal regulators have turned down.
In addition to the six states currently implementing Medicaid expansions or planning to do so soon, New Hampshire will transition to a waiver in January. Expansion coverage in Montana will be effective then as well.
Two states now have waiver proposals pending before CMS. Arizona implemented the expansion but has a waiver application pending that seeks changes based on state law. Michigan has a pending waiver amendment seeking changes required by state law to continue its expansion after April 2016.
While each state’s waiver is unique, they include some common provisions, Kaiser notes. Among these are implementing the Medicaid expansion through a premium assistance model; charging premiums; eliminating non-emergency medical transportation; and using incentives promoting healthy behavior to reduce premiums and/or co-payments.
Indiana’s waiver approval included provisions CMS had not approved in other states. These include allowing the state to waive retroactive eligibility (which was also later approved in New Hampshire); making coverage effective as of the date of the first premium payment, rather than the date of application; and barring re-enrollment for six months if for insures who are dis-enrolled for unpaid premiums. (A similar three-month exclusion was later approved for Montana).
In addition, under another waiver, Indiana received approval to charge higher cost-sharing for non-emergency use of the emergency room than federal rules otherwise allowed.
Unique among the expansion waivers to date, Montana received approval to implement 12-month continuous eligibility for new adults, to reduce switching between Medicaid and Marketplace coverage due to small changes in income.
CMS has denied a number of provisions in state waiver proposals. These included requests for authority to include premiums for individuals with incomes under 100% FPL as a condition of eligibility; requirements to omit benefits for Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) and free choice of family planning provider; and work requirements or incentives as a condition of Medicaid eligibility.
There is no deadline for states to participate in the Medicaid expansion, Kaiser noted, so additional states may seek waivers to implement or modify their expansions.
Among the provisions being considered in various states are: using Medicaid as premium assistance to purchase Marketplace coverage; imposing premiums and cost-sharing higher than current federal limits; offering incentives for healthy behavior; limiting non-emergency medical transportation; and adopting provisions that interrupt, delay or extend effective coverage dates.
In addition, a new innovation waiver authority will become available in 2017 which will allow states to waive Marketplace coverage provisions and combine those waivers with Medicaid and CHIP waivers.
“As more states seek waivers to implement the expansion, what we learn from their experiences will help inform the future direction of coverage for low-income adults and families,” Kaiser concluded