Daily Independent (Ashland, KY)

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April 15, 2013

Beshear close to decision on expanding Medicaid rolls

FRANKFORT — Gov. Steve Beshear said his administration is close to making a decision about expanding Medicaid rolls under provisions of the Affordable Care Act or Obamacare.

That decision should come “probably in the next four to five weeks,” Beshear said Monday.

The ACA attempts to increase the number of people with health insurance coverage by asking states to expand Medicaid rolls to cover working poor families whose income previously exceeded Medicaid eligibility guidelines. Originally, the legislation would have required states to do that, but the U.S. Supreme Court ruled the federal government cannot force states to participate.

That set off pleas by those who oppose the health care expansion to governors around the country to refuse to go along. Most of the criticism came from Republicans but several Republican governors have since relented and agreed to expand their states’ Medicaid rolls.

Under the law, the federal government will pay 100 percent of the added cost in the first three years, and after that the state would gradually take over 10 percent of the cost by 2020, leaving 90 percent of the cost with the federal government.

Like their counterparts in other states, Kentucky Republicans generally oppose expansion and the Republican state Senate passed a bill to prohibit Beshear from doing so without legislative approval. But the bill died in the Democratic-controlled House.

Estimates vary between 400,000 and 600,000 on the number of Kentucky uninsured residents who might be eligible. The Kaiser Foundation has said Kentucky would benefit from the AFA-Medicaid expansion more than any other state.

Beshear has previously said he supports expanding the program for the poor and disabled – if the state can afford it.

“We are continuing to analyze that, but we are getting fairly close to a decision,” Beshear said Monday. “Probably in the next four to five weeks we’ll probably make that decision.”

Beshear wouldn’t say if the analysis has revealed what the total cost would be to Kentucky, but he said that information will be released publicly when a decision is announced.

“If I can determine that the state can afford it in the long run,” Beshear said, “certainly that’s the direction I would want to go.”

Beshear said the analysis is of both short-term immediate costs as well as the long-term health care savings anticipated by the expansion.

Kentucky has a very large uninsured population and a very unhealthy population, Beshear said. “Anything we can do that we can afford to make our population more healthy, I’m certainly in favor of doing.”

Beshear said he’s hearing from several medical providers, primarily hospitals, urging him to take the step.

“Hospitals in particular who will lose their DSH payments under the Affordable Care Act, I think look at the expansion as a means to at least replace some of that DSH money.”

Disproportionate Share Hospital payments go to hospitals that provide indigent care in order to compensate them for part of the costs on that care.

National hospital associations participated in discussion and drafting of the legislation, agreeing on behalf of their members (which do not include all hospitals) to accept lower Medicaid reimbursement rates in exchange for expanding Medicaid rolls.

That’s because hospitals already serve those populations but other than the DSH payments receive no compensation. Expanding Medicaid would provide reimbursement for many of those indigent patients.

Beshear said Kentucky must decide the issue in the next month or so in order to plan its implementation which is scheduled to begin Jan. 1, 2014.

One of the criticisms by those opposed to expansion is that states could be left holding the bag down the road if the federal government backed off paying 90 percent of the costs. But Beshear said that’s not a real danger.

“The states can decide to end that expansion at any point in time,” the governor said. “So should the federal government fail in the future to put up the money to cover the cost as the law provides, then a state could opt back out of that expansion.”

Beshear has already established by executive order the creation of a health benefits exchange, an online site where consumers can shop, compare prices, and purchase health insurance, another provision of the ACA. If a state doesn’t establish such exchanges, its residents can use a federal exchange, but that federal exchange is taking longer to set up than anticipated.

All exchanges, state and federal, were supposed to be operational by Jan. 2014.

Beshear said Kentucky is on track to meet that target with its exchange.

RONNIE ELLIS writes for CNHI News Service and is based in Frankfort. Reach him at rellis@cnhi.com. Follow CNHI News Service stories on Twitter at www.twitter.com/cnhifrankfort.

 

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