FOCUS - Insuring Utah's needy

JOHN ROGERS

The Enterprise

The Utah attempt to expand Medicaid under Pres. Obama’s Affordable Care Act is back in the morgue and won’t get a rehearing at least until the 2016 session of the Legislature begins on Jan. 25.

During the 2015 session, lawmakers nixed two Gov. Gary Herbert-backed options: Healthy Utah and Utah Cares. Two weeks ago, in a Herbert-called special session, it was Utah Access Plus that got the ax. It is estimated that some sort of Medicaid expansion would extend health insurance coverage to more than 125,000 Utahns.

Under the latest compromise proposal, people would receive financial assistance to purchase private health insurance, as opposed to the traditional Medicaid approach of government-provided insurance. According to reports in local media, House Speaker Gregory Hughes, R-Draper, said that only seven of 63 House Republicans supported the plan. The Republican caucus voted in a closed-door meeting on Oct. 13.

The next day, Herbert met with Hughes and Senate Pres. Wayne Niederhauser, R-Sandy, and agreed not to revisit the issue until the 2016 legislative session.

“What we do here is a long-term solution for the state,” Niederhauser said. “The state’s got to live with this for 20 to 50 years, or maybe even longer.”

For months, Herbert has been looking for a way to expand Medicaid and take advantage of federal money available to the state through ObamaCare — estimated to be $450 million — but with the rejection of this latest compromise effort, there is no clear path forward. 

Thirty states have so far expanded Medicaid, the government health insurance program for the poor, under ObamaCare. The expansion extends eligibility to people earning up to 138 percent of the federal poverty level (FPL) — about $33,000 for a family of four. The Obama administration has pressured states to expand the program, promising to work with them on compromises that put conservative twists on the program. 

Utah had appeared the most likely state to be next to accept the expansion. The other 19 states that have yet to expand Medicaid are largely led by Republicans who resist expansion, mostly citing its cost. In Utah, House Republicans noted the Obama administration’s reluctance to allow states to set enrollment caps and worried they would not be able to control costs in Utah Access Plus.

The plan would also have helped pay for expansion with a new tax on health providers, under the theory that they stand to gain from having newly insured patients. That provision met resistance from Republicans in the Legislature. 

“Everyone loves expanding Medicaid until they have to pay for it,” Hughes told The Salt Lake Tribune. Hughes promised that the expansion effort would continue. “I do believe the state of Utah and its Legislature has the political will to provide healthcare to those who need it.”

Hughes told Townhall.com that it was concerns about the long-term sustainability of the Medicaid funding for the program, the potential for exploding costs and vocal opposition from medical providers that ultimately doomed Utah Access Plus in the House.

One of the concerns voiced nationwide about any Medicaid expansion is the probability that more than the intended beneficiaries — America’s working poor — would take advantage of the program. In states where Medicaid expansion has passed, a large percentage of enrollees are healthy, able-bodied and childless adults who have other options to find healthcare. To counter the trend in some states, like Virginia, almost a quarter of doctors aren’t accepting new Medicaid patients.

The Utah Access Plus plan was very similar to the Healthy Utah plan proposed by Herbert earlier in the year with a few minor tweaks. The highlights included:

• Coverage for low-income Utahns earning up to 138 percent of FPL ($33,465 for a family of four).

• Approximately 126,500 Utahns would have received coverage under Utah Access Plus, including 32,000 adults from 100 percent to 138 percent of FPL, 63,000 adults below 100 percent of FPL and 31,500 so-called “woodwork effect” children and adults — those currently unidentified but that would have “come out of the woodwork.”

• It is estimated that 78 percent of the expansion population would have received premium assistance to join employer-sponsored plans or to purchase private commercial plans on the exchange. Healthcare providers would have received commercial reimbursement rates for these patients. Individuals between 100 percent and 138 percent of FPL would have been required to share in premium contributions, deductibles and co-pays.

• Individuals meeting the definition of “medically frail” would have received traditional free Medicaid coverage.

• Utah Access Plus was expected to cost the state of Utah $78 million to implement. 

• To pay for plan implementation, healthcare providers that would have benefitted from the plan would have received a “proportional assessment” related to expected provider benefit to begin in 2017. These funds would have been generated through a variety of new assessments, licensing increases, premium taxes and, in some cases, a gross receipts tax.

Following the rejection of Utah Access Plus, Herbert’s office released a statement that, in part, said, “The poorest among us will continue to struggle until Utah leaders can find agreement on this difficult issue. As new plans are brought forward, the governor maintains that his Healthy Utah proposal was the most innovative and cost-efficient for the state. ... After three years debating this issue, he has yet to see a better proposal that respects taxpayers while caring for Utahns most in need.”

Although future decisions regarding Medicaid expansion are up in the air, Niederhauser is telling Utahns to “keep the faith and make sure you’re working with your legislators to make sure they know how you feel about it.”