Medicaid Expansion Waiver Filed by State

By Bonnie Bochniak
Vice President, Government Relations
MBPA/MFBA

Nov. 26, 2013 – The office of Governor Rick Snyder has submitted the waiver amendment needed to expand Michigan’s Medicaid eligibility, capturing individuals with incomes up to 133 percent of the federal poverty level, which is roughly $15,000 a year for a single person. This waiver also fosters healthy behaviors to help decrease the rate of chronic diseases and to encourage overall health.

Background:

What kind of coverage will be provided?
Coverage will include access to primary care doctors, preventative care and routine checkups.

How much will it cost Michigan?
There is no net cost to the state over the next 21 years, and Michigan will save $320 million in uncompensated care costs by 2022 and $206 million in General Fund costs in 2014 alone.

Who will pay for the expansion?
Federal funds will cover 100% of the cost of Medicaid expansion from 2014 to 2016, 95 percent in 2017, 94 percent in 2018, 93 percent in 2019 and 90 percent in 2020 and subsequent years. With the Medicaid expansion, the federal government will cover expenses Michigan pays for today, saving the state $206 million in in General Fund costs in 2014 alone. The proposed budget deposits $103 million of those savings into a new health savings fund to cover Michigan’s future health care liabilities.

Will Michiganders who already have insurance benefit?
Yes. Today, uninsured citizens often turn to emergency rooms for non-urgent care because they don’t have access to primary care doctors – leading to crowded emergency rooms, longer wait times and higher cost. By expanding Medicaid, those without insurance will have access to primary care, lowering costs and improving overall health.

Will businesses benefit?
Yes. Under the Affordable Care Act, the federal government is mandating that businesses either provide health care to their employees or pay a $2,000-per-employee penalty. By expanding Medicaid, Michigan can provide an affordable option that will help businesses stay open.**

Michigan’s Medicaid Expansion will provide eligibility to about 450,000 people state-wide, once it is enacted on April 1, 2014.  Michigan Community Health Director Jim Havemen said the state department had been holding discussions with the Center for Medicare and Medicaid Services (CMS) since August and is confident of its approval before the end of this calendar year. CMS is an arm of the U.S. Health and Human Services (HHS) Department, tasked with administering sections of the Affordable Care Act.

The State of Michigan will soon provide information to the public through websites and toll-free numbers in the upcoming weeks. Michiganders eligible to sign up will begin receiving benefits on April 1st, 2014, and in the meantime, may utilize an employer sponsored plan, or the federal exchange.

As always, MBPA’s legislative team will keep you up to date as more information is announced.  Please feel free to contact our team with any questions at 586-393-8800 or by email: BBochniak@michbusiness.org

*Information provided by Michigan.gov/MiBudget2014