Moody: Governor Supports Medicaid Expansion to Mitigate Effects on Businesses
Greg Moody, director of the governor's Office of Health Transformation, laid out the various rationales behind the administration's support for expanding Medicaid under the federal Affordable Care Act (ACA) in the proposed budget for FY14-15, HB59, telling the Senate Finance Committee Thursday that the "primary reason" Gov. Kasich recommended the expansion "was to mitigate the effects on businesses." He said in Ohio alone businesses that choose not to provide health care coverage beginning in January 2014 face $88 million in penalties -- penalties that would be avoided if Medicaid were expanded. (See separate story, this issue.)
He also told the committee that the Arkansas House just this week "approved the Ohio plan" but cautioned, because the health insurance alternative that they have been working on is a waiver program, "not that many states will be granted waivers." And he said other states are interested.
After the session he told reporters it would be ironic for Ohio, which "blazed the trail for an alternative ... to have created the path," to lose out on the opportunity to pursue the program itself.
That plan, according to Moody would do the following:
- Convert the Affordable Care Act Medicaid expansion into a private sector health insurance option.
- Attract insurance carriers and enhance competition in the Ohio insurance marketplace.
- Strengthen personal responsibility through cost-sharing.
- Create workforce linkages to find and keep a better job.
- Increase access to providers, especially primary care.
- Make the Ohio Option a three-year demonstration and evaluate performance before making a decision to continue.
He stressed that the goal of the plan is to create a "ladder" so people can move up and out of reliance on government programs.
Moody's presentation was backed up by other members of the "health transformation team": John McCarthy, director of Medicaid; Tracy Plouck, director of the Department of Mental Health; John Martin, director of the Department of Developmental Disabilities; Bonnie Kantor-Burman, director of the Department of Aging; and Ted Wymyslo, M.D., director of the Department Health.
Moody stressed the strides this administration has taken in the past two years to address the steep growth in the Medicaid budget, explaining that $2 billion was saved. He added that he believes this is the time and this is the team of individuals to implement the state's version of Medicaid expansion.
Asked by Sen. Dave Burke (R-Marysville) what made the difference in their being able to contain the growth of the program, McCarthy answered it was several elements: the new claims processing system that allows the state to pay correctly for the services provided; the work of the managed care providers who "have stepped up," moving into a "pay for performance" system; and the steps taken in the current budget to rein in nursing home costs.
Moody had earlier discussed a chart showing that they are succeeding in shifting Ohio's use of nursing homes versus home and community based services, projecting that that will continue in the coming biennium.
In addition, Moody pointed out that Ohio's Medicaid system relies on the private managed care programs to provide the services.
Addressing who would be covered under the Medicaid expansion, Moody offered the following overview:
- Individuals with income less than 100 percent of poverty ($11,170 for an individual or $23,050 for a family of four).
- Individuals who work but their employer does not offer or they cannot afford health insurance.
- Individuals who work as health care providers for others but don’t themselves have coverage.
- Individuals who are over age 55 looking for work but finding it difficult.
- At least 26,000 are veterans.
- Individuals who are unable to work because of mental illness or addiction but have no regular source of care to recover.
He added, "When these uninsured individuals seek care, often in the emergency room, other Ohioans pay the cost through higher premiums and other indigent care programs."
Moody said extending Medicaid coverage would provide a $404 million benefit to the state in the coming biennium with it being basically "a wash" by 2020 when they project it will cost the state $37 million. There is also a benefit to local communities that will see local funds totaling approximately $130 million freed up.
Before concluding the discussion of the expansion, he scrolled through a long list of supporters, starting with the Ohio Chamber of Commerce, Ohio Right to Life, Catholic Conference of Ohio, Ohio Manufacturers' Association and many more. Moody commented that he has never seen such a diverse group of supporters for any issue.
He did conclude with the following list of consequences for not extending coverage:
- 275,000 low-income Ohioans will not get coverage.
- Ohio will not keep $2.4 billion in Ohioans’ federal tax dollars ($13 billion over seven years).
- 26,000 uninsured veterans will not get coverage.
- Local hospitals will not be protected.
- Ohio businesses will be subjected to $88 million in penalties annually.
- Approximately $711 million in mental health and addiction services will not be provided.
Among other initiatives highlighted in the morning's testimony were the following:
- Develops a plan to provide post-acute rehabilitation in nursing homes, not hospitals while at the same time assisting nursing home residents who want to move back into the community to do so.
- Rebuilds community recovery services.
- Converts development disabilities institutional placements into community settings with additional support for the "Employment First" program and increased access to autism services.
- Administratively, consolidates the departments of mental health and alcohol and drug addiction services, creates a unified Medicaid budgeting/accounting system; creates a Department of Medicaid; replaces the 34-year-old eligibility system; and coordinates health sector workforce programs.
- Requires local departments of health to seek accreditation; local board members to receive continuing education; and shared services to be pursued "to improve efficiency."
The presentation from Thursday's hearing can be found under Hannah News' "Budget Watch" tab>Written Testimony on State Budget at http://www.hannah.com/ .
Story originally published in The Hannah Report on April 18, 2013. Copyright 2013 Hannah News Service, Inc.
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