Expanded Medicaid provisions a financial benefit to Arizona

Posted by AzBlueMeanie:

The Arizona legislature froze enrollment in the state's Medicaid system (AHCCCS) for chidless adults last year to balance the state budget. In a lawsuit challenging the budget cuts under Prop. 200 (2000), the Arizona Supreme Court wussed out relying on the political question doctrine of separation of powers to hold that the legislature has discretion to make budget decisions despite the citizens initiative, which takes precedence over simple legisaltive acts. I would argue the decision also eviscerated Prop. 105 (1998), the Voter Protection Act (apparently not so much).

In any case, the expanded Medicaid provisions of the Affordable Care Act present an opportunity to restore cuts to AHCCCS at a financial benefit to the state of Arizona. The Arizona Capitol Times (subscription required) reports Analysts: Arizona would get cash infusion by lifting Medicaid enrollment freeze:

[The Affordable Care Act] which the U.S. Supreme Court upheld last month incentivizes states to open their Medicaid rolls to more people beginning in 2014. Though the court struck down the penalties to states that don’t do so, the federal government still plans to dramatically increase the amount of money it gives to states to cover those new health care costs.

In particular, that money will cover much of the cost for states to include childless adults – the same group of Arizonans who were directly affected by the AHCCCS enrollment freeze.

Currently, the federal government covers 66 percent of the costs for that population.

But the match increases to roughly 74 percent in 2014 and continues to grow in subsequent years, reaching 91.5 percent in 2020.

Legislative budget analysts say that restoring the coverage for childless adults means lowering the cost for existing participants by $217 million, and that, in turn, will offset the cost of letting in new enrollees.

The bottom line, the analysts determined, is that the state could improve its financial position by $51 million by 2015 if it lifts the enrollment freeze.

But it’s not clear if the state will get that extra money if it doesn’t comply with another provision in the federal law that requires states dramatically expand Medicaid enrollment to everyone who makes less than 133 percent of the federal poverty limit.

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[T]he Joint Legislative Budget Committee analysts say it’s unknown whether the federal government will “link” the extra money for childless adults to the general Medicaid expansion.

“We do not know if the childless adult population would receive an enhanced federal match rate if the state foregoes the 133 percent expansion,” the analysts wrote last week in a report on what the ruling means for Arizona.

Dr. Eve Shapiro writes in the Arizona Daily Star today, Expanding health insurance for the poor is imperative:

One outcome of the Supreme Court decision on the Affordable Care Act was to allow the states the choice of expanding Medicaid to 133 percent of the federal poverty level without risking the loss of federal funds.

Let's review what that means for Arizona and the ramifications of the decision to participate or not that the state will have to make.

Currently, Arizona Medicaid, or AHCCCS, covers people up to about 100 percent of federal poverty level, or FPL (an annual income of about $26,000 for a family of four) except for childless adults, for whom AHCCCS enrollment has been frozen.

For the latter group, only those making below about 33 percent of FPL, about $4,000, are eligible, due to the state's decision to suspend Proposition 204.

What has this meant in the year since the freeze has been in effect? More than 100,000 people are no longer eligible for health insurance coverage, decreasing their access to care. Hospitals are unable to get compensation for these patients, and are seeing huge losses, especially in rural areas.

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Given this evidence, what should Arizona do?

For at least the next two years, the Affordable Care Act will pay 100 percent of the cost for insurance for those patients between 100 and 133 percent of FPL.

After that time, 90 percent of the cost will be covered.

Given the nature of the health-care system and the way a decision in one area impacts us all, it would seem to be obvious that turning down the federal funds is, in effect, harming the most vulnerable Arizonans with possible lethal consequences.

In other words, our governor and legislators would be condemning up to 100,000 people to poorer health and well-being for what? To make a point?

In addition, if Medicaid is not expanded, what will happen to those patients caught between 33 and 100 percent of FPL? Would they have to pay a penalty for not purchasing insurance? They are some of the least able to afford it, and that was not the intent of the Affordable Care Act.

It is vital that we convey in the strongest language possible how important it is that Arizona use federal funds, worth billions of dollars, to improve the lives and health of Arizonans and bring job- creating money to the state.

Let's expand Medicaid to 133 percent and restore the coverage of the Prop. 204 population. Our future depends on it.

Contact Governor Jan Brewer and your state legislators to tell them to support the expanded Medicaid provisions.