Michigan Legislature Approves Medicaid Expansion
Lawmakers in Michigan finally reached a consensus on expanding the state's Medicaid program.
The state Senate voted on Aug. 27 to approve a Medicaid expansion plan, known as Healthy Michigan. It will provide coverage to 470,000 residents who are currently uninsured but earn too much money to qualify for Medicaid coverage. However, the legislation includes some carrots and sticks intended to appease conservative lawmakers.
Among them are co-payments and income-based premiums for Medicaid enrollees, and opportunities to reduce their out-of-pocket costs if they lose weight or quit smoking.
And after four years in the program, new Medicaid enrollees would have to pay higher out-of-pocket costs or purchase coverage on the state's health insurance exchange.
“The Healthy Michigan plan emphasizes personal responsibility,” said Michigan Gov. Rick Snyder, a Republican who supported expansion.
The bill was sent to the Michigan House of Representatives for a concurrence vote, which occurred earlier this month. Snyder said he plans to sign the legislation when it reaches his desk.
The bill would expand coverage to Michiganders earning up to 133% of the federal poverty level, which is $15,500 for an individual or about $31,100 for a family of four.
However, enrollees would have to pay up to 5% of their income for premiums and other out-of-pocket costs. That would rise to 7% after four years of enrollment. Some health policy experts say is too high a burden for low-income individuals and households. The cost-sharing provisions would apply even for individuals and families with incomes below the federal poverty level.
The legislation had passed the Michigan House earlier this summer, but the Senate, which was deeply divided over expanding Medicaid, took a lengthy recess before contemplating the bill.
The first vote on Aug. 27 fell one senator short for the 20-vote majority required for passage. However, it passed 20-18 in a second vote a few hours later after an amendment was introduced that limited how much hospitals could charge uninsured patients. Only eight Republican senators joined all 12 Democrats in passing the legislation.
That the Senate could not provide a two-thirds majority vote on the bill means Medicaid expansion will not take place immediately, with the earliest date for implementation being late March, even though the Medicaid expansion provision of the Affordable Care Act takes effect on Jan. 1. That is expected to cost the state at least $630 million in federal funding next year, officials said.
Under the ACA, the federal government would pay 100% of all Medicaid expansion costs for the first three years, and 90% in subsequent years. Michigan is expected to receive about $1.7 billion a year in federal funds to implement the expansion.
"I am outraged that the Senate Republicans continued to play politics...with the lives of 400,000 Michiganders who currently have no insurance. Their irresponsible actions to appease extremists by denying immediate effect on (the bill) may also cost the hundreds of millions of dollars in federal funds,” said House Minority Leader Tim Greimel, a Democrat representing the Detroit suburb of Auburn Hills.
Greimel and other Democrats said they would push a bill that would implement Medicaid expansion sooner.
However, the cost-sharing provisions also require approval by the Centers for Medicare & Medicaid Services in form of a waiver. The agency has generally been skeptical of overly onerous cost-sharing provisions in Medicaid programs, and it is unknown if it will sign off on the Healthy Michigan plan.
