By Michael Collins, The Commercial Appeal (Memphis, Tenn.)
WASHINGTON — If Gov. Bill Haslam is searching for clues about what kind of deal Tennessee might be able to cut with the federal government to expand Medicaid, he should look just across the Mississippi River.
Arkansas was the first state to get a federally approved waiver allowing it to use Medicaid funds to buy private insurance for low-income residents. At least two other states — Iowa and Michigan — also have won federal approval to use the money for alternative programs tailored specifically to their needs.
Several other states, including Tennessee, are negotiating with the U.S. Department of Health and Human Services for permission to set up state-specific health insurance programs instead of expanding traditional Medicaid.
“Once Arkansas got its waiver in place, that sort of signaled to other states that were reluctant to expand (Medicaid) that there was some other kind of opportunity to be had,” said Nicole Huberfeld, a professor of health law at the University of Kentucky.
Haslam has been in discussions with the federal government for months to win approval for a Tennessee-specific plan to expand Medicaid coverage, which is a key component of President Barack Obama’s Affordable Care Act. Under the health care law, the federal government would pay 100 percent of the expansion costs in the first three years.
Haslam’s office and federal officials said last week those discussions are still underway.
“HHS is working with the state to explore options that improve care and lower costs in the Medicaid program,” said Fabien Levy, a spokesman for the federal agency
Publicly, Haslam has talked only in broad terms about what he is pursuing. He wants Tennessee to be able to use the federal money to buy private insurance for low-income residents instead of expanding traditional Medicaid. He also wants to require co-payments for some of those insured so they will have a personal investment in their health care decisions.
Both are components of Arkansas’ plan, which the federal government approved last September after seven months of discussions.
Faced with a lack of political appetite to expand traditional Medicaid but with an obvious need to insure thousands of low-income residents, Gov. Mike Beebe and the Arkansas legislature eventually settled on a private-option plan. Federal money that would have been used to expand traditional Medicaid is used instead to buy private insurance for qualifying residents. To be eligible, enrollees must earn below 138 percent of the federal poverty level, or $15,900 for someone who is single. Some co-payments are required on a limited basis.
Between 200,000 and 250,000 Arkansans are eligible for coverage under the program, which took effect Jan. 1. As of late March, some 233,000 had already completed applications. More than 121,000 already are getting coverage.
“There is definitely significant interest — you could tell by the number of people who applied for coverage,” said Amy Webb, spokeswoman for the Arkansas Department of Human Services.
Iowa, which won federal approval for its own private-option plan last December, also uses Medicaid expansion money to help low-income residents buy private health insurance. Under the agreement with the federal government, beginning in 2015, the state will be allowed to charge modest premiums to people who earn between 50 percent and 133 percent of the federal poverty level. The premiums can be waived if the insured person follows certain prescribed healthy behaviors.
Roughly 85,000 people already have signed up for insurance under the program, which took effect Jan. 1, said Amy McCoy, spokeswoman for the Iowa Department of Human Services. An estimated 150,000 people are expected to sign up within three years.
Michigan’s plan, approved last December and effective April 1, expands Medicaid eligibility to up to 133 percent of the federal poverty level and requires co-payments and income-based premiums that can be reduced by making healthy lifestyle choices. Enrollees must make an appointment with a primary care physician within 60 days of signing up and come up with a health-incentives plan, such as quitting smoking or exercising more.
Michigan residents have a lot of chronic health issues, such as obesity, so “we wanted to do something that was a little more beneficial to the health status of our residents,” said Angela Minicuci of the Michigan Department of Community Health.
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