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“Partial Medicaid Expansion” with ACA Enhanced Matching Funds: Implications for Financing and Coverage

Explainer
  1. Traditional Medicaid match rates range from 50% to 77% in FY 2020.

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  2. The statute specifies 133% FPL but also includes a 5 percentage point FPL income disregard, bringing the eligibility limit up to 138% FPL. The ACA expansion group excludes individuals who are age 65 or older, pregnant, dually eligible for Medicare, or otherwise described in another mandatory coverage group.

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  3. A state plan for medical assistance must. . . provide for making medical assistance available. . . to all individuals. . . beginning January 1, 2014, who are under 65 years of age, not pregnant, not entitled to, or enrolled for, benefits under part A of [Medicare], or enrolled for benefits under part B of [Medicare], and are not described in a previous subclause of this clause, and whose income. . . does not exceed 133 percent of the poverty line. . . .“ 42 U.S.C. § 1396a (a)(10)(A)(VIII) (emphasis added).

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  4. Wisconsin covers parent and caretaker relatives up to 100% FPL (95% FPL plus the 5 percentage point FPL disregard under the modified adjusted gross income methodology) pursuant to state plan authority. WI SPA #14-005-MM1, Eligibility Groups – Mandatory Coverage Parents and Other Caretaker Relatives (approval date 4/24/14, effective date 1/1/14), https://www.medicaid.gov/State-resource-center/Medicaid-State-Plan-Amendments/Downloads/WI/WI-14-005-MM1.pdf; WI SPA #14-011-MMI, Eligibility Groups – Mandatory Coverage Parents and Other Caretaker Relatives (approval date 4/24/14, effective date 1/1/14), https://www.medicaid.gov/State-resource-center/Medicaid-State-Plan-Amendments/Downloads/WI/WI-14-011-MM1.pdf.

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  5. Wisconsin had a Section 1115 waiver that expanded Medicaid coverage before the ACA allowed states to receive federal matching funds for coverage expansions without a waiver. Instead of adopting the full ACA expansion and receiving the accompanying enhanced federal matching funds in 2014, Wisconsin chose to modify its existing waiver and provide coverage for childless adults up to the poverty level at its traditional Medicaid matching rate. CMS Special Terms and Conditions, #11-W-00293/5, Wisconsin Badger Care Reform (current approval period Oct. 31, 2018-Dec. 31, 2023), https://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Waivers/1115/downloads/wi/wi-badgercare-reform-ca.pdf.

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  6. The newly elected governor in Wisconsin has supported implementation of the full ACA Medicaid expansion which would include access to the enhanced matching funds. Kaiser Family Foundation, Medicaid: What to Watch in 2019 from the Administration, Congress, and the States (Jan. 2019), https://www.kff.org/medicaid/issue-brief/medicaid-what-to-watch-in-2019-from-the-administration-congress-and-the-states/.

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  7. Arkansas has indicated that it is continuing to discuss approval for a partial expansion with enhanced ACA matching funds with CMS.

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  8. Utah voters passed a ballot measure in November 2018 that requires the state to expand Medicaid coverage under the ACA to 138% FPL beginning April 1, 2019, and increases the state sales tax to finance the expansion.

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  9. Utah Code § § 26-18-3.9, (2)(b), 26-18-415 (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html. Utah’s June 2018 pending waiver amendment would cover adults ages 19 to 64 up to 95% FPL (effectively 100% FPL with the 5 percentage point FPL disregard). The pending waiver amendment also seeks CMS approval for a work requirement and an enrollment cap on the expansion group. The state estimates that 70,000 to 90,000 individuals would gain coverage under this waiver amendment. The pending waiver amendment also seeks to waive EPSDT for 19 and 20 year olds and authority for mandatory Medicaid premium assistance for individuals with access to ESI. Utah’s existing Section 1115 waiver covers two groups that would be subsumed into the new partial expansion group if the June 2018 waiver amendment is approved: (1) the Primary Care Network (PCN) group and (2) the Targeted Adult group. The PCN group was first implemented in 2002, and currently provides a limited benefit package of primary and preventive care services to a capped number (to be closed to new enrollment at the state’s election or upon reaching 25,000 average annual enrollment) of nonelderly parents with incomes above state plan amounts up to 100% FPL and childless adults from 0-100% of poverty. The Targeted Adult group, added in November 2017, provides full state plan benefits to a capped number (to be closed to new enrollment at the state’s election) of childless adults up to 5% FPL who are chronically homeless or involved in the criminal justice system and in need of behavioral health treatment.

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  10. Utah Code § 26-18-3.9, (3) (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html.

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  11. Utah Code § 26-18-3.9, (4) (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html. The state legislation does not explain how such a per capita cap would operate other than to say that it would include an annual inflationary adjustment, account for “differences in cost among categories of Medicaid expansion enrollees,” and provide “greater flexibility to the state than the current Medicaid payment model. This waiver request also would seek to limit presumptive eligibility for the expansion group and impose a lock-out period if an expansion enrollee violated “certain program requirements as defined by the department,” 12-month continuous eligibility, and housing supports.

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  12. This section is only contingent on CMS approval of the partial expansion with an enrollment cap and enhanced ACA matching funds; it does not require CMS approval of the financing “per capita cap.”

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  13. The vast majority of individuals with incomes 100-138% FPL would be eligible for tax credits to subsidize the cost of coverage in the Marketplace, though some (e.g., people with an offer of employer coverage) may not qualify for tax credits.

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  14. These studies pre-date policy changes that eliminated the cost sharing reduction (CSR) payments. Without CSR, adding individuals with incomes 100-138% FPL to the Marketplace could have different implications.

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  15. Utah Code § 26-18-3.9, (3) (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html.

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  16. Utah Code § § 26-18-3.9, (2)(b), 26-18-415 (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html; State of Utah, 1115 Primary Care Network Demonstration Waiver, Adult Expansion Amendment Request (June 22, 2018), https://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Waivers/1115/downloads/ut/ut-primary-care-network-pa4.pdf; see also supra. n.10.

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  17. This section is only contingent on CMS approval of the partial expansion with an enrollment cap and enhanced ACA matching funds; it does not require CMS approval of the financing “per capita cap.” The state legislation also requires this waiver request to include limits on presumptive eligibility, a lock-out period for enrollees who violate certain program requirements to be specified by the state, 12-month continuous eligibility, and housing supports. Utah Code § 26-18-3.9, (4) (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html. If partial expansion with an enrollment cap and enhanced matching funds is not approved by January 1, 2020, the state law directs Utah to seek authority for a full Medicaid expansion up to 138% FPL, with an enrollment cap and “additional flexibilities and cost controls” including cost-sharing and a work requirement. The state legislation also requires this waiver request to include mandatory Medicaid premium assistance for enrollees with access to employer sponsored insurance, delivery of benefits through accountable care organizations with physical and behavioral health services integration, limits on presumptive eligibility, and a lock-out period for enrollees who violation certain program requirements to be specified by the state. If expansion to 138% FPL with a work requirement and mandatory ESI premium assistance is not approved by July 1, 2020, full Medicaid expansion shall take effect. Utah Code § 26-18-3.9, (5) (as amended by S.B. 96, Feb. 11, 2018), https://le.utah.gov/~2019/bills/static/SB0096.html.

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