Basically Bevin wants the other states to take care of his poor people. Must be a states rights thing: pic.twitter.com/j6IAAV3EsY
— TBogg (@tbogg) November 4, 2015
The 1115 waiver is how Montana, Alaska, Iowa, Arkansas and half a dozen other states have expanded Medicaid. If straight up Medicaid expansion is replaced with a 1115 waiver Medicaid expansion in Kentucky, then most of the 420,000 people who are on expanded Medicaid in Kentucky will still have coverage although it has been worse coverage.
The 1115 waivers that have been approved have set some strict limits:
- No more than 2% of income can be spent on premiums and only if people make more than 100% of the Federal Poverty Line
- Cost sharing can be maxed out at 5% of income
- Redetermination of eligibility can happen annually instead of every six months
- Health Savings Accounts are approved with state seed money
- Medicaid is not tied to job or educational efforts.
I don’t think Kentucky would go Arkansas model of paying for private insurance. Arkansas is seeing that this route is extremely expensive. So far it has not mattered for Arkansas as the Federal government has been paying 100% of the cost to expand Medicaid without calling it Medicaid Expansion or Obamacare. That changes on 1/1/17 as the states will have to start kicking money in. The Arkansas model will cost the state an incremental $15 to $20 million dollars per year over straight up Medicaid expansion.
If we assume the Center for Medicare and Medicaid Services follows their precedent, a probable Kentucky 1115 waiver will impose some premiums or mandatory HSA contributions, some non-ambulatory transportation services will be cut and cost sharing for emergency room visits will increase. The premiums will push some people out of the program. Everyone else will have another hoop to jump through but they’ll still have coverage.
I thought this was a 10% probability last night, but with new information I’m bumping this up to a 60% probable outcome.