HARRISBURG -- Gov. Tom Corbett's administration announced Monday a plan to overhaul the state's Medicaid program by curtailing the number of benefit plans available, implementing monthly premiums on a sliding scale, and instituting a work-search requirement for unemployed working-age adults -- but, notably, the governor is not expanding the program under the Affordable Care Act.
Rather than an expansion, the administration wants to pursue a so-called "premium assistance model" that would give subsidies to 520,000 low-income consumers to allow them to buy insurance on the newly created health care exchanges -- if the federal government allows the state to make the changes it wants to the existing program.
Monday's announcement at a downtown Harrisburg hospital by the governor and several Cabinet secretaries follows months of discussions with the federal government -- as well as pressure from a number of advocacy groups to expand Medicaid to cover hundreds of thousands of uninsured Pennsylvanians and take advantage of billions in federal funds.
"If -- and only if -- the federal government approves Pennsylvania's plan to reform our existing Medicaid program, the commonwealth would be in a position to utilize federal dollars to offer access to a private health care coverage option to low-income, newly eligible Pennsylvanians -- up to 133 percent of federal poverty -- who are uninsured," the governor, a Republican, said Monday afternoon.
The timeline on any of the proposals actually being realized is uncertain, as they are all still subject to federal approval and nothing formal has even been submitted from the state other than a "concept paper" that was submitted Monday.
"We don't know exactly when we're going to be able to get this up and running," said Beverly Mackereth, the state's Secretary of Public Welfare, said, speaking to reporters Monday.
The federal Department of Health and Human Services is "encouraged by Pennsylvania's commitment to helping cover more of the state's uninsured population," agency spokesman Fabien Levy said. "As we have done with other states, we are eager to work with Pennsylvania to provide the best options that work for Pennsylvanians."
Other details of the plan also seemed fuzzy Monday, as administration officials could not give any dollar figure for proposed cost savings, though the governor repeatedly cited Medicaid's growing cost as a reason the program couldn't be expanded. The program takes up about 27 percent of the state's general fund budget.
"We believe it will be a cost savings for the commonwealth," Ms. Mackereth said.
By choosing not to expand Medicaid and instead pushing those low-income Pennsylvanians onto health care exchanges, it's not clear if Mr. Corbett has crafted a middle-of-the-road compromise or, if by trying to both accept the federal money yet not expand Medicaid, he angers both sides of the political spectrum.
Conservative state Rep. Daryl Metcalfe, R-Cranberry, a frequent critic of the governor, will hold an event today with Americans for Prosperity Pennsylvania to demonstrate the plan's "destructive impacts," according to a statement.
Several legislators, however, said they were encouraged by the governor's announcement.
Senate Majority Leader Dominic Pileggi, a Republican, in a statement said he applauded the governor.
"It would be foolish to leave billions of Pennsylvania tax dollars in Washington, D.C., when that money can be used to expand health care coverage and access to the residents of our state in a fiscally responsible way."
On June 30, the Senate voted 40-10 in favor of an expansion of Medicaid in a budget-related bill, though the language was later stripped out when the House voted on the proposal. The expansion was supported by 17 of 27 Senate Republicans.
Senate Minority Leader Jay Costa, D-Forest Hills, said his caucus is pleased the governor is looking to expand access to health care, but has questions about specific components of the plan. He said they believed the work requirement proposal, for example, could be problematic.
Administration officials said the work search requirement would only apply to able-bodied, unemployed, working-age adults, though Ms. Mackereth conceded that many Medicaid recipients are children, the elderly and/or disabled. She could not say how many recipients the requirement might realistically apply to.
The proposed changes to Medicaid need federal approval, but do not need to go through the General Assembly, said Todd Shamash, deputy chief of staff for Mr. Corbett.
The governor also announced several other initiatives Monday he says will improve access, affordability and quality for consumers, including a proposal to eliminate the six-month waiting period for children enrolling in the Children's Health Insurance Program. Also on the table: a loan forgiveness program for doctors in underserved areas, creating a long-term care commission and a number of other proposals.
Under a Medicaid expansion, as proposed by the 2010 Affordable Care Act, the federal government would pay the full cost of newly eligible Medicaid enrollees for three years. After that, the federal share gradually would decrease to 90 percent in 2020.
Though the expansions initially were envisioned as a mandatory part of the Obamacare overhaul, each state has the option of whether to expand the program because of last year's Supreme Court ruling that the Medicaid expansion should be optional.
The expansion was meant to make Medicaid available for virtually all people living at or below 138 percent of the federal poverty line. Currently, Medicaid serves select low-income populations -- disabled, pregnant, children and others.
More details of the governor's proposal are available online at www.pa.gov.
First Published September 16, 2013 1:45 PM