Gov. Matt Bevin’s Medicaid revamp revolves on his belief that losing almost $1.9 billion in federal funds for health care in Kentucky to save $331 million in state funds over five years is “fiscally responsible.”
That’s one clue to what’s wrong with the proposal for a Medicaid demonstration project or “waiver” that Bevin sent the feds last week. Some slight, but welcome, revisions were made in response to public comments. But the troubling essentials remain unchanged.
While Bevin sent his plan to Washington, he sent mixed signals at home.
Speaking to reporters Wednesday, Bevin renewed his threat to end Medicaid coverage for 440,000 low-income Kentuckians whose earnings put them above the poverty line unless the feds OK his plan, including provisions that have been rejected in other states and that officials have made clear will not be approved here.
“If, in fact, there are not structural changes made, there will not be the ability to have an expanded Medicaid in Kentucky,” Bevin said. “That’s just the reality of it. So the ball is in their court. If there is to be expanded Medicaid in Kentucky, it is entirely up to them.”
The next day Bevin was more conciliatory. Asked at the state fair if he was willing to negotiate the waiver’s provisions with Health and Human Services Secretary Sylvia Burwell, he said, “Absolutely, that’s where we are in the process,” reports Kentucky Health News.
Bevin’s willingness to negotiate is encouraging. The stakes are high for 1.3 million Kentuckians who depend on the federal-state program and for medical providers who have enjoyed steep declines in bad debts since 2014 when the combination of expanded Medicaid and government-subsidized health insurance, made possible by the Affordable Care Act, drastically reduced the number of uninsured Kentuckians.
Bevin justifies his plan by saying that the Medicaid expansion is not improving Kentuckians’ health, a conclusion that is premature and counter to research which shows: Low-income Kentuckians are skipping fewer medications because of costs, having less trouble paying medical bills and increasingly obtaining routine care. During the first year of expansion, more than 300 new behavioral-health providers enrolled in Kentucky Medicaid and at least 13,000 individuals with a substance-use disorder received treatment. Kentuckians report feeling healthier.
Bevin proposes a complex system of awards, premiums and co-pays that would deny coverage to extremely poor people and cost more to administer than would be generated in revenue or savings. His goals of encouraging work and community engagement are fine, but Medicaid is the wrong vehicle. Bevin can start jobs and adult-ed programs already.
Bevin’s plan to move Kentuckians onto employer-provided health insurance is mostly unrealistic because low-wage workers frequently change jobs and their employers often don’t offer insurance. Bevin’s savings would come from covering almost 86,000 fewer people than would otherwise be eligible and by excluding benefits like dental and vision. Taxpayers would pay more per person in the Medicaid expansion for less health care, presumably to pay for new bureaucracy.
Kentucky has paid nothing for the Medicaid expansion but must shoulder a fraction of the cost next year, capping out at 10 percent in 2021. Kentucky pays 30 percent of traditional Medicaid; the federal government pays the rest. Taxpayers and their representatives in Congress see the value of helping a poor state improve its residents’ health. Kentucky’s elected leaders should too. The wider the coverage the more leverage the state has to improve health outcomes and control costs through evidence-based practices.
If Bevin ends the Medicaid expansion and unpaid hospital bills rise and constituents ask lawmakers why they lost their medical care, Kentuckians will know the governor, not someone in Washington, is responsible.