In a recent New York Times article, Rober Pear reported that the Obama Administration is putting pressure on states to expand Medicaid, telling them they may lose federal money if they delay. The expansion of Medicaid is a major part of President Obama’s health care law, originally expected to account for half of the 32 million people who are to gain coverage. Congress required states to expand Medicaid to cover people under the age of 65 with income less than or up to 133 percent of the federal poverty level (up to $25,390 for a family of three).
Citing that decision, Cindy Mann, the federal official in charge of Medicaid, said, “A state may choose whether and when to expand, and if a state covers the expansion group, it may decide later to drop the coverage.”
Since the creation of Medicaid in 1965, the federal government and the states have shared the costs. The federal share now averages 57 percent.
Ms. Mann said that while “there is no deadline” for expanding Medicaid, states would pay a price for delay.
Under the new law, she said, the federal government will pay the entire cost of Medicaid coverage for newly eligible beneficiaries for three years, from 2014 to 2016. The federal share will decline to 95 percent in 2017, 94 percent in 2018, 93 percent in 2019 and 90 percent in 2020 and later years.
The federal payment rates “are tied by law to the specific calendar years noted,” Ms. Mann said. So if a state defers the expansion of Medicaid to 2016, the federal government will pay 100 percent of the costs for only one year. After 2016, the federal share will drop to the levels specified by Congress, and states will be responsible for the remainder.
Governors of some states, like Louisiana and Texas, oppose the expansion of Medicaid. Other governors, like those of Illinois and Washington, have said they want to expand the program as Congress intended. In many states, action by state legislatures will be needed to expand eligibility or to authorize the spending of federal money.
Health Care Managers see expansion of Medicaid as new revenue for their organizations.
Jerry Lovrien has held positions of Chief Executive Officer at health and behavioral health facilities in Minnesota and Washington State. He served successfully as State Director/Commissioner of Health and Behavioral Health in Georgia, West Virginia and Minnesota. Jerry has taught high school through graduate courses and is currently an Instructor with Broadview University.
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