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Healthcare Alternatives working group needs to understand Medicaid expansion experience from other states

Healthcare Alternatives working group needs to understand Medicaid expansion experience from other states

Fred Birnbaum
July 21, 2016
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July 21, 2016

The first meeting of the Legislature’s “Healthcare Alternatives for Citizens Below 100 Percent of Poverty Level” occurred July 20. The formal agenda included two subjects following the introductory remarks: 1. Review of proposed 2016 legislation relating to the health-care coverage gap. 2. Review of recommendations from governor work groups.

Although this was just the opening meeting, it seems to me this agenda is the policy equivalent of looking in the rear-view mirror. Granted, the co-chairman wanted to establish a “baseline,” so let’s not assume this was just a chance to rehash old proposals. I hope not, because there is all kinds of evidence from other states that Obamacare and the Medicaid expansion aren’t producing the promised outcomes.

I would suggest that before the legislative working group even considers policy proposals it should fully understand the experience of the other 49 states. Twenty-five states have expanded Medicaid in its traditional form, six states have expanded Medicaid but used some alternative model, and 19 states thus far have not expanded Medicaid. Idaho is in that last group. This is a great data set for benchmarking.

After a review of legislation introduced in the past session, the working group turned to Health and Welfare Director Richard Armstrong to review the recommendations from the governor’s work groups. Director Armstrong acknowledged the governor’s work group was directed to find a path to Medicaid expansion. The option that was selected, Healthy Idaho, or option 3.5, was described as a hybrid of traditional Medicaid expansion and the “Arkansas” model, which used federal money to cover the expanded Medicaid population through Qualified Health Plans sold on the exchange.

According to a thorough review of the “Arkansas” plan by the Platte Institute for Economic Research, Arkansas’ Medicaid expansion costs have been far higher than expected. Prior to the Medicaid expansion, it was projected in 2013 that the cost per new enrollee would be $3,900 per year, but the actual cost in 2014 was $5,900 per year.

Similarly, Brian Blasé, in a recent Forbes article states, “the average cost of the Affordable Care Act’s Medicaid expansion enrollees was nearly 50% higher in fiscal year (FY) 2015 than HHS had projected just one year prior. Specifically, HHS found that the ACA’s Medicaid expansion enrollees cost an average of $6,366 in FY 2015 — 49% higher than the $4,281 amount that the agency projected in last year’s report.”

It is imperative the working group not lead Idaho down a failed path to Medicaid expansion in its quest to address the “gap population.” Armstrong said he did not know what percentage of the gap population had chronic diseases. That knowledge “gap,” coupled with mounting evidence from other states, suggests Idaho needs to come up with a different solution than what was proposed either by Director Armstrong or captured by most of the legislation presented during the 2016 session.

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