Bevin says he wouldn't end Medicaid expansion immediately but would transition to modified program; Stivers talks similarly

By Al Cross
Kentucky Health News

LOUISVILLE -- Republican Matt Bevin said Tuesday that if elected governor he would not immediately end the state’s expansion of eligibility for the federal-state Medicaid program, contrary to what he said for months.

“That’s not what I’m calling for, at all,” he said at a forum with Democratic Attorney General Jack Conway at the Kentucky Chamber of Commerce’s Business Summit and Annual Meeting in Louisville.

Instead, Bevin said afterward, he favors a modified plan based on the experience of other states such as Indiana, which received federal waivers to create a complex program in which Medicaid beneficiaries pay premiums (as small as $1 a month) to get better benefits, and some clients make co-payments for non-emergency use of emergency rooms.

Republican legislators seem headed in the same direction. On Monday, the legislature's top Republican said he favored a modification, not a cancellation, of the expansion that provides free health care to more than 400,000 people – and that he liked the Indiana example.

Senate President Robert Stivers of Manchester said, “The discussion that I have heard would be transitioning to a different model of covering that population, and I know from talking to several people that they’re looking at other models. I think other states have done that and gotten waivers, particularly Indiana.”

Stivers added, “When you look at this, and I think most people will talk about when they’re discussing it, it’s more a scalpel approach than a sledgehammer.” Republican Appalachian districts like Stivers' have seen some of the largest declines in percentage of the population without health coverage.

Bevin began saying in February that he would end the expansion immediately, which would require an executive order. Stivers made clear that he thinks decisions about Medicaid should be made by the legislature.

Stivers said it was not appropriate for the 1966 legislature to authorize governors to get all the Medicaid money they could – a law Beshear used to expand the program without legislative approval – and that it would not be appropriate for future governors to leave legislators out of the equation.

(Video from The Courier-Journal)

Bevin said that if elected, he wouldn’t “have the ability to just shut things down. It’s like going to war. You don’t just come home on Tuesday.”

Told that he could issue an executive order ending it the next month, he replied, “And create what degree of chaos?”

Reminded that he had said he would end it immediately, he said “I said I would address it. I didn’t say I would end it immediately. Go back and look at what I said.”

The Lexington Herald-Leader and The Associated Press reported in February that Bevin said he would end the expansion “immediately.” Herald-Leader reporter Sam Youngman reminded Bevin of that.

Bevin said, “Yeah, well, here’s the bottom line: We need to address the situation. We need to effectively come up with a program that works for folks.”

Conway has used Bevin's "immediately" line to claim that Bevin would "on day one" remove all the expansion enrollees from the Medicaid program, and did so twice during Tuesday's forum.

Earlier in the post-forum press conference, Bevin was asked what he likes about Indiana’s Medicaid expansion.

“What I like about it is the sense of ownership” that it gives clients, he said. “It’s giving people a vested interest, because when people do not have any control over their own lives, including the decisions they make as it relates to health care, even if it’s a token amount, even if it’s five or 15 or 25 dollars a month – which seems token to some but isn’t token to some of these folks. Having skin in the game is a big, big differentiator when it comes to whether or not a person has the dignity that comes with making decisions for themselves. . . . They’re treating people with dignity and respect, and giving them the belief that they have control over their own situation and people are seizing that.”

According to the Kaiser Family Foundation, Indiana offers four separate Medicaid packages, and further differentiates among clients according to income, frailty and premium payments. Non-frail adults above the federal poverty level are taken off the program after they fail to pay premiums for six months. Also, coverage starts with the first premium payment, not the application for coverage.

In almost all other Medicaid expansion states, including Kentucky, free care is given to people with household incomes up to 138 percent of the federal poverty level. The old threshold in Kentucky was 69 percent.

Indiana limits premium payments to 2 percent of income ($27 per month for those at 138 percent of the poverty level). Premiums go into a health savings account and offers incentives for clients to follow healthy behaviors: If their health-savings account has money left over at the end of the year, they can roll it over; if they receive preventive services, the rollover balance is doubled, up to the total premium payment for the year.

The federal government pays the entire cost of the expansion through next year. In 2017, the state begins paying 5 percent, rising to the federal health-reform law's cap of 10 percent in 2020. Bevin said he would change the program before 2017.

Conway, asked during the forum how he would pay the state's share, cited a Deloitte Consulting study for the state that showed the expansion would add a net $77 million to the state budget in 2017 and $87 million in 2018, through expanded jobs in health care and taxes paid by those workers.

The study also says the expansion will pay for itself in 2019 and 2020, but not in 2021. If the study's predictions fall short, Conway said, the state could seek waivers to reduce its costs.

Bevin again dismissed the study, calling it "nonsense." He said Kentucky should "be more creative than just grabbing free money form the federal government," apply for waivers and "look at what other states are doing. Don't reinvent the wheel. Let's look for ways to do what Indiana, to the north, is pioneering."