CMS Approves Pennsylvania’s Alternative Medicaid Expansion Plan

CMS has approved Pennsylvania Gov. Tom Corbett's (R) alternative plan to expand the state's Medicaid program under the Affordable Care Act, the Washington Post's "GovBeat" reports (Millman, "GovBeat," Washington Post, 8/28).

The approval makes Pennsylvania the 27th state -- in addition to Washington, D.C. -- to expand its Medicaid program under the law (Radnofsky, Wall Street Journal, 8/28).

Details of Pennsylvania's Plan

Corbett originally had sought approval to use money available through the ACA's Medicaid expansion to purchase private health coverage for state residents. However, Corbett and CMS ultimately agreed on a plan that would expand Medicaid through managed care organizations, according to the Washington Post's "Wonkblog" (Millman, "Wonkblog," Washington Post, 8/28).

Under the plan, all residents with incomes up to 133% of the federal poverty level, or about $15,500, will be eligible for Medicaid coverage beginning Jan. 1, 2015. In 2016, residents with incomes above 100% of FPL will be required to pay premiums for the plans that equal no more than 2% of total household income. Such individuals can be dropped from coverage if they fail to pay the premiums ("GovBeat," Washington Post, 8/28).

The plan also offers premium discounts for residents who participate in a voluntary job training program (AP/Modern Healthcare, 8/28).

Further, the plan permits the state to charge beneficiaries an $8 copayment if they use the emergency department in non-emergency situations (Wall Street Journal, 8/28).

The plan also allows the state to reduce 14 of its current Medicaid coverage plans into two different benefit packages.

Enrollment in the program begins Dec. 1 (Russ/Morgan, Reuters, 8/28).

Obama Administration Approves Plan

With CMS' approval, Pennsylvania is now authorized to use federal funds granted under the ACA to purchase private health plans for low-income residents ("GovBeat," Washington Post, 8/28). Federal funds will account for 100% of the expanded program's costs through 2016. Federal funding for the program will gradually decline to 90% starting in 2017 (AP/Modern Healthcare, 8/28).

CMS Administrator Marilyn Tavenner said, "Like we are doing in Pennsylvania, [HHS] and CMS are committed to supporting state flexibility and working with states on innovative solutions that work within the confines of the law to expand Medicaid to low-income individuals" ("GovBeat," Washington Post, 8/28).

Reaction

Jen Branstetter, the governor's policy director, called the approved plan "a huge victory for Pennsylvania," adding that the Corbett administration "got maximum flexibility from the federal government" (Wall Street Journal, 8/28).

Health advocacy groups said the plan is good news for Pennsylvania residents who fall into coverage gaps by having incomes too high to qualify for Medicaid coverage but too low to qualify for federal subsidies to help them purchase health plans through the ACA's insurance exchanges. Pennsylvania Health Access Network Director Antoinette Kraus said, "There never should have been a coverage gap in Pennsylvania and we share the relief of hundreds of thousands of uninsured Pennsylvanians in knowing it's finally on track to close."

However, Kraus said she remains concerned about the plan's placement of most adults into "low-risk" health plans with basic benefits (Goodnough, New York Times, 8/28).

Tenn. Gov. Plans To Submit Alternative Medicaid Expansion Plan

In related news, Tennessee Gov. Bill Haslam (R) on Thursday said the state might soon submit a plan to expand its Medicaid program under the ACA for approval, the AP/Tennessean reports.

Haslam did not release any details on the potential plan. However, Haslam in March 2013 said that he would not expand a traditional Medicaid model but that he favored a plan that would use federal funds to help low-income resident purchase private health coverage.

Haslam on Thursday said, "I think we'll probably go to [the federal government] sometime this fall with a plan ... that we think makes sense for Tennessee" and "works financially for the state long term."

Haslam added that he spoke with HHS Secretary Sylvia Mathews Burwell this week by phone and hopes to speak with her in person in Washington, D.C., once a meeting can be arranged.

According to Kaiser Family Foundation, not expanding Medicaid under the ACA has resulted in 162,000 Tennessee residents remaining uninsured (Wilemon, AP/Tennessean, 8/28).

Meanwhile, the Tennessee chapter of the National Association for the Advancement of Colored People and other health care advocates on Thursday called on Haslam to expand Medicaid. Tennessee NAACP President Gloria Sweet-Love said the group sent a letter to Haslam about two weeks ago about the issue and will hold more events focusing on Medicaid expansion throughout the year (AP/Sacramento Bee, 8/28).