A reality based independent journal of observation & analysis, serving the Flathead Valley & Montana since 2006. © James Conner.

23 July 2015

MT’s awful Medicaid expansion law may never be fixed

Governor Steve Bullock flew to Washington, D.C., yesterday to make his case that Montana should be granted a federal waiver (application, PDF) to implement GOP Sen. Ed Buttrey’s law to accept federal money for expanding Medicaid.

Buttrey’s law, which Bullock signed with great fanfare and no appearance of shame, requires those eligible for expanded Medicaid to purchasing private health insurance policies using federal subsidies. That’s bad enough, as it diverts some of the money to profits, not medical care, and condemns the eligible to dealing with private health insurers. It also requires the highest possible copays and perhaps worst of all, a two percent tax on the Medicaid recipient’s income. The law calls the tax a “premium,” but that section of the law quacks like a tax.

Montana’s waiver request will generate some tough discussions with the U.S. Department of Health and Human Services, reports Kaiser Health News today:

Montana is the only state to say yes to Medicaid expansion this year. If its plan is accepted by the federal Centers for Medicare and Medicaid Services (CMS), it will join 28 other states and the District of Columbia in accepting the health law’s federal funding to expand the joint federal-state health care program to anyone with an income below 138 percent of the federal poverty level.

But the Montana plan doesn’t offer the coverage free. Instead it would require all recipients who come into the program through the expansion to pay a premium of up to 2 percent of their income in order to receive benefits.

“Premiums are not permitted in the Medicaid program, and a state definitely needs a waiver to move forward with any premium proposal,” Alker said.

That provision was a key part of the effort to get the bill through the Republican-led legislature in a very contentious battle. A group of moderate Republicans eventually sided with all of the Montana legislature’s minority Democrats to pass the expansion plan, which its Republican sponsor says, “is not Medicaid expansion.”

CMS has approved premiums for the new expansion population in other states, but has been cool to proposals, like Montana’s, to require even those making less than 100% of the federal poverty level (about $11,800 for an individual) to pay them.

“CMS is definitely willing to approve premiums of 2 percent of income for those above the poverty line,” Alker says, but has said no to premiums for those below the line, “because there’s a lot of research showing that premiums for very low income people deters enrollment, and creates a barrier to coverage that we know will result in many people not getting coverage. And that’s why CMS has raised questions about premiums as other states have raised them.”

CMS has said yes to waivers for Indiana and Iowa that levee fees or premiums for those below 100% of FPL, but in neither state can recipients below that income level be dis-enrolled for failing to pay them.

Here’s how the Buttrey-Bullock law handles people below 100 percent of the federal poverty level who fail to make their Medicaid tax payments:

sb405

Page 6, Section 7, of SB-405.

I think the waiver will be approved, and that most if not all of the Buttrey-Bullock law will survive as approved by the legislature. The Obama administration’s goal is getting people insured, and it’s willing to bend the demonstration projects provision of the Affordable Care Act into a pretzel to accomplish that.

Will this awful law ever be repaired? Will it return expanded Medicaid to a single-payer system? Some people think so. “We’ll get people covered first,” Democrats were told, “then we’ll fix the bill.”

Bushwa. Even with a legislative majority and a Democratic governor, reforming the Buttrey-Bullock law might be impossible. The law’s a bailout and sweetheart deal for the health insurance industry and has strong backing from most hospitals. That’s a strong constituency that will lobby hard to keep the law. There will be Democrats without sufficient backbone to resist that lobbying. There are always jellyfish Democrats.

The myth of moderate Republicans

KHN reports that the bill passed when a group of moderate Republicans joined with a solid for the bill Democratic caucus. That’s one way to describe what happened, but it’s not the best description of what went down. Actually, Buttrey and the health insurers wrote the law with limited input from, I’m told, two Democratic legislators from Helena. It’s more accurate to report that all Democrats voted for a Republican bill supported by less than a dozen GOP legislators.

If these GOP legislators truly were moderate, they could have joined with the Democrats to enact into law Medicaid expanded as intended. They didn’t. Instead, they engineered an ugly law that may help some poor people, but at the same time punishes and shames them for being poor. Democrats whooped and hollered ecstatically at the chance to vote for this legislation that Gov. Bullock now says will, among other things, “Provide incentives that encourage Montanans to take greater responsibility for their personal health.” Translation: the Buttrey-Bullock law will teach the poor, assumed to impecunious because of moral failings, personal responsibility.

Montana’s Democrats are proud of they’re doing to Montana’s poor. But I’m not proud of those Democrats. And I do not trust Democrats on health care. No progressive should.