Medicaid expansion would make thousands more Kansans eligible

02/28/2013 11:20 AM

02/28/2013 11:20 AM

Mark Oates has been a truck driver for most of his life.

A single parent, the 49-year-old is raising his 12-year-old daughter in Bentley, out of the big city.

But the medical bills are piling up, especially after a recent hospitalization.

“Sometimes you have to drop your pride to ask for help. I’ve had to,” he says.

Oates says he needs to have extensive work done on his teeth but can’t afford more than antibiotics when they get infected. He also has high blood pressure and diabetes.

If it weren’t for the care he has received at the E.C. Tyree Health and Dental Clinic, 1525 N. Lorraine, he says, he doesn’t know what he would do.

Oates is one of thousands of Sedgwick County residents who would be eligible if Kansas Medicaid were to be expanded.

According to the Kaiser Family Foundation, about 380,000 Kansans are currently on Medicaid.

The current eligibility threshold for an adult with children is less than 32 percent of the Federal Poverty Level, or about $5,900 for a family of four, according to the Kansas Health Institute.

But if the program were to be expanded to those who make 138 percent or less of the Federal Poverty Level, the threshold would change to about $15,850 per year for an individual and about $32,500 for a family of four.

Although Gov. Sam Brownback has not yet decided whether Kansas will participate, the federal government is offering to pay 100 percent of the cost for the state to take on “newly eligibles” for the first three years. That amount then phases to 90 percent.

Medicaid expansion is a key component of the Affordable Care Act, said Sheldon Weisgrau, director of the Health Reform Resource Project funded by Kansas Grantmakers in Health.

Kansas has one of the lowest thresholds for Medicaid eligibility in the country, Weisgrau said, and the change would particularly benefit childless adults in Kansas.

The majority of current Kansas Medicaid recipients are pregnant women, children and the disabled. Some parents of children also qualify. Expansion would essentially get rid of those categories and base eligibility solely on income, Weisgrau said.

Cost to expand

Several studies have been conducted to estimate the cost of expansion, but estimates have varied wildly.

Most recently, an independent analysis conducted for the state said expansion would cost $1.1 billion over 10 years. Without expansion, the state would spend $513.5 million, in part because people who are now eligible for Medicaid but are not enrolled could sign up.

The study estimates about 151,000 Kansans would be covered through expansion.

The Kansas Health Institute estimates that about 122,000 adults and 117,800 children would be added at a cost of about $518.5 million from 2014 to 2020, according to a December issue brief.

The Kansas Policy Institute, a conservative think tank, estimates expansion would cost more than $2 billion through 2023.

According to 2010 Census data, about 74,425 people in Sedgwick County – or about 17.1 percent of the population – are uninsured.

Weisgrau said officials estimate about two-thirds of the uninsured nationwide will get some sort of coverage as a result of the Affordable Care Act, and roughly 60 percent of those people would be covered through Medicaid expansion.

Nationwide, an estimated 25 million to 30 million people would get insurance under the law.

Among states, the decision to participate in expansion is split, with 13 states not participating, five states leaning toward not participating, three states leaning toward participating, six states undecided and 23 states and the District of Columbia participating, according to the Advisory Board Company, a global research and consulting firm.

Weisgrau thinks the expansion could ultimately mean savings by cutting things such as government grants many public health departments and safety net clinics receive to help offset the costs of providing services to those who aren’t currently covered. There also would be more jobs created, he said.

Another possible savings would be in prison and jail budgets, Weisgrau said.

“Thousands of mentally ill are incarcerated, in part because they are unable to access adequate mental health care because of financial barriers,” he said. “With expanded Medicaid, many of these people would be covered, making mental health care more accessible and potentially reducing the number of mentally ill people in prisons and jails.”

Opponents of expansion say they are worried about whether the federal government will keep its end of the bargain.

Rep. Dave Crum, R-Augusta and chairman of the House Health and Human Services Committee, says he expects extensive debate in the Legislature over the topic.

Crum, who does not support the expansion of Medicaid, mostly for financial reasons, said that although the federal government will pay for part of the bill, “we have to look at what it’s going to do down the road.”

“My concern is if we’re going to be able to continue to meet the needs of the most vulnerable if we add another 122,000 people and make our Medicaid population about 550,000 over time in that range,” Crum said. “That’s a significant number of individuals to support in Medicaid for the state and federal government.”

He said he’s also concerned about the impact expansion could have on the state’s ability to pay for other programs.

“By extending Medicaid, we’re crowding out funding for education, public safety and other budget issues. Medicaid is second-largest (item) in the budget next to education,” he said.

Provider impact

Medicaid expansion will have the greatest impact on providers that treat the uninsured and accept Medicaid. Both Wesley Medical Center and Via Christi officials say they support expansion.

“As a Catholic health care organization, we believe that expanding the Medicaid program will improve access to health care for low-income Kansans,” said Jeff Korsmo, president and CEO of Via Christi Health. “We think it’s the right thing to do.”

But beyond the principle of it, Korsmo said that hospitals across the country are already paying for the expansion through future cuts in Medicare payments from the federal government. Medicare is a national health insurance program for those older than 65.

“Those states that choose not to do the expansion are basically hitting those hospitals twice,” Korsmo said.

Hospitals across the country already agreed to Medicare cuts of roughly $150 billion, Korsmo said.

For Via Christi, the estimated cut is about $22.4 million per year. Medicaid expansion would return about $7.5 million to the system.

Wesley will face up to $11 million in cuts per year but is unsure of how much would return through Medicaid expansion, said Hugh Tappan, CEO of Wesley Medical Center.

“The hospital industry is the ultimate safety net,” Tappan said. “If there is not an effort to change the way that we’re taking care of this population, we will continue to see this population in the emergency department, but there will have to be a way to pay for that. … Ultimately, it impacts businesses. It impacts jobs. It impacts more than just the bottom line. It impacts families.”

For GraceMed clinics, the expansion could bring in an estimated $1.8 million, said Dave Sanford, CEO.

“Many of the people we see now that are uninsured would either be covered by the expansion or the health care exchanges. …That relates to our desire to establish new access points to equip and hire a work force that would make GraceMed far more self-sufficient and able to generate revenue above our expense on an annual basis with the ability to reinvest that revenue back into our ministry,” he said.

But Sanford says he doesn’t think expansion is likely.

“My concern right now is that, with new legislators, so many of them included in their platform running against ‘Obamacare.’ We need a period of time where reason and logic can come back into the equation,” he said.

“Let’s look at the Affordable Care Act and its components as if we’re students and trying to identify the pluses and minuses and all of the impacts here in Kansas. If we do that, then I will be satisfied that at least the opportunity had its day in court.”

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