Op-ed: Ohio and Kentucky want to change their Medicaid plans. That would be a mistake

Posted at 7:00 AM, Jul 14, 2017

Col Owens is a retired attorney who lives in Fort Mitchell. He is the chairman of the Kenton County Democratic Party.

This is a tale of two governors and two states. And why we must preserve Medicaid as a national program.

The first, John Kasich, is serving his second term as governor of Ohio. He is a Republican.

The second, Matt Bevin, is serving his first term as governor of Kentucky. He is also a Republican.

Col Owens

Both states adopted the Medicaid expansion made possible by the Affordable Care Act, or ACA. By its terms, the ACA mandated the expansion, but the Supreme Court interpreted it in such a way as to render it a state option. Under Gov. Kasich’s strong leadership, Ohio expanded health care coverage to some 700,000 additional people. Under former Gov. Beshear’s strong leadership, Kentucky expanded coverage to an additional 450,000 people.

These two governors grabbed the opportunity to better their people and their states’ economies.

However, the Ohio legislature, dominated by a conservative Republican majority, required a waiver to Ohio's Medicaid program to be submitted for approval to the federal government. In Kentucky, Bevin has sought a similar waiver. These waivers would allow them to alter their Medicaid programs in fundamental ways. There are similarities between the two, such as imposing premiums on low-income adults. Kentucky would require adult participants to work, while Ohio proposed that those not working be referred to employment agencies.

In September 2016, the Centers for Medicare and Medicaid Services (CMS), the federal agency that oversees Medicaid, denied Ohio’s waiver application. Its rationale was that the proposed changes would result in some 125,000 people being dropped from coverage, and that that was not consistent with the purposes of the program.

Kentucky’s waiver proposal has yet to be acted upon.

In the meantime, Gov. Bevin has recently sought to amend that proposal, to make it even more onerous for participants. The result would be that 95,000 people would lose coverage, 9,000 more than under the original proposal. This approaches the number that would have lost coverage in Ohio, despite the fact that Kentucky has only about one-third the population.

One might surmise that the Ohio decision would bode ill for Kentucky. But the election of Trump and the appointment of a new, more conservative secretary of the U.S. Department of Health and Human Services - the cabinet agency in which CMS is located – along with the appointment of a new CMS director who happens to have drafted Kentucky’s waiver proposal – suggest that Kentucky’s waiver, despite its more onerous impacts, will be approved.

Recently, the Ohio legislature mandated a freeze on future enrollments for Medicaid. Gov. Kasich vetoed that provision. The House failed to override that veto this past week, but could do so in the future. Ohio Medicaid is still in great jeopardy.

Thus, the first blow of the one-two punch to Medicaid.

The second lies with the federal health care bill now pending before the Senate. This bill gives great discretion to states regarding the insurance part of the ACA, for example, to reduce the essential health benefits that must be included in plans offered through the marketplace. The Medicaid sections of the bill are mandatory for all states.

These Medicaid changes will do real damage.

Over a period of years, the enhanced federal match rate of 90 percent, which made it possible for states to expand coverage to additional millions of people, would be reduced to the states’ ordinary match rates. This alone would insure that states are unable to maintain their expansion coverage.

But in addition, federal reimbursement would be capped at the historical rate plus the change in the Consumer Price Index -- or CPI -- for all enrollees, not the health CPI factor. This would force states to reduce even further their coverage of millions of eligible people, according to the Congressional Budget Office.

State waivers that reduce the effectiveness of the Medicaid program should be rejected.

The federal bill that cuts coverage to millions of eligible people should also be rejected.

State legislators and members of Congress must stop treating Medicaid as an ideological Rorschach, to be shaped to their fantasies, and see it for what it is: an efficient program that pays for health care delivered by private providers to tens of millions of poor and vulnerable Americans.

The majority of Americans believe that affordable health care coverage should be available to all Americans. Medicaid is a critical component of our national strategy for achieving that goal.

Let’s protect and strengthen it, not diminish it.

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