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Committee OKs expanding state Medicaid eligibility

State House Bureau

October 02. 2013 7:52PM

CONCORD — The state will not wait for a federal waiver before expanding Medicaid eligibility under the Affordable Care Act under a plan adopted Wednesday.

The committee studying Medicaid expansion rejected a proposal by Rep. Neal Kurk, R-Weare, on a 5-3 vote, to not expand the program unless the state receives a waiver from the Center for Medicaid Services to allow it to use a program that would use Medicaid funds to pay the premium for those eligible under expansion who are currently on their employers’ health plans.

The group also rejected 6-3 a plan to automatically end state participation if program costs exceed estimates. However, the nine-member Commission to Study Expansion of Medicaid Eligibility did want to put restrictions on program costs, but could not agree on the mechanism.

The commission has been working since July and now faces an Oct. 15 deadline to make recommendations to the Legislature on the expansion of Medicaid eligibility to 138 percent of the federal poverty level.

If the state decides to expand, the federal government will pay 100 percent of the cost for the newly eligible participants for three years and then gradually reduce its share to 90 percent by 2021.

In arguing to end expansion if costs exceed estimates by more than 20 percent, Kurk said the state could not afford the program.

“We have very limited financial resources in this state,” he said, “and I have significant doubts we can afford a $20 million a year (increase). That’s $40 million a biennium and that sounds like a new tax to me.”

But others argue the state will not know the actual program costs until the program is in place for two years. They said the Legislature is better able to determine if expansion should continue and if the expansion is cost effective.

“The New Hampshire Legislature has a long history of restraint,” said Sen. Peggy Gilmour, D-Hollis, noting she would be uneasy tying program continuation to some abstract concept.

The committee did agree on several key elements of what would be the state’s expansion plan that lawmakers will have to approve either at a special session or at the beginning of the next year.

Although some members were more comfortable expanding Medicaid to only 100 percent of the poverty level, the commission eventually agreed it should be 138 percent.

The nine members were almost unanimous in agreeing the state would mandate those eligible for Medicaid with employer-supplied health insurance to participate in the Health Insurance Premium Payment program, which pays the premium and the costs of required services not in the private coverage.

The costs of the premium and additional services would have to be equal to or less than the cost of providing health insurance through the regular Medicaid program.

The commission also agreed to a provision to allow those between 100 to 138 percent of the poverty level to purchase policies through the health insurance exchange paid for by Medicaid funds. The program would be voluntary so the state would not need a waiver.

“One of my worries,” said Rep. Thomas Sherman, D-Rye, who drafted the proposal, “is mandates limit our options to expand (Medicaid) and tell people of sound mind and bodies what is best for them.”

The commission also agreed the benefits under expansion should be the 10 essential services that must be offered in all plans sold on the exchange as well as mental health and substance abuse treatment coverage, which is required under the ACA.

The benefits would have to be the same for the three options, but do not have to be a managed care plan similar to the state’s Medicaid Managed Care program, which begins Dec. 1 after several years of delays.

Sherman’s proposal is similar to what state health and insurance officials have discussed as possibilities that would allow the state to develop its own expansion plan rather than simply add more people to the Medicaid program.

The committee meets again Oct. 8 to review a draft of its reports and to discuss both a minority report and a date when the program should begin.

Sherman’s proposal would begin the program Jan. 1, but if the state did not receive the necessary waiver, it would end Aug. 1 unless lawmakers voted to continue participation.

New Hampshire is one of eight states who have yet to decide on whether to expand Medicaid eligibility.

If New Hampshire decides to expand Medicaid eligibility to 138 percent of the federal poverty level, state health and human service officials say that will add 49,000 people to the program over the next seven-and-a-half years, while the federal government will pay $2.4 billion to health care providers. The state is expected to spend about $18 million for expansion over the period.

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