State holds Medicaid hearing

State Department of Welfare Secretary Bev Mackereth made her pitch Tuesday at the Blair County Convention Center for the Medicaid reform portion of Gov. Tom Corbett’s Healthy PA plan, which aims to reduce Medicaid’s gargantuan share of the state budget and close insurance coverage gaps for the needy.

The plan is the state’s proposed alternative to accepting the federal Medicaid expansion program, which could have gone into effect at the beginning of this month.

Fourteen people – many representing health care businesses with a stake in the program – testified at the hearing, praising or panning the governor’s plan.

The federal offer would bring Medicaid coverage to everyone up to 133 percent of federal poverty, filling gaps in the state’s current irregular but collectively generous eligibility requirements, adding about 400,000 people to the Medicare rolls, with all additional costs covered by the feds for three years and 90 percent thereafter.

That’s not good enough for Pennsylvania, according to Mackereth.

“People say [Medicaid] is not broken,” she said.

But the program here includes one in six people, devours 27 percent of the state’s total budget at $8 billion a year, costs $21 billion altogether, grows every year by $300 million and poses a threat to other key budget categories like education and transportation, Mackereth said.

“We think we’ve come up with a Pennsylvania solution,” she said.

The plan would increase access to health care for 500,000 people, ensure their benefits match their needs and nudge them toward accepting personal responsibility, she said.

It would reduce the current welter of 14 Medicaid plans to two – one for high-risk adult patients, one for low-risk.

It would place people age 21 to 64 up to 133 percent of poverty and not currently eligible for Medicaid into a private insurance program with the same “essential benefits” as required by the Affordable Care Act.

And it would require some of them to help pay for the care and look for work to be eligible for it, with reductions in premiums for those who developed healthy habits and complied with requirements.

A single adult making more than 100 percent of poverty would pay $25, while a family with such an income would pay $35.

Pregnant women, those collecting Supplemental Security Income and institutionalized people would be exempt from the payment requirement. There would be no co-pays, except $10 for inappropriate use of hospital emergency rooms.

But those between 21 and 64 working fewer than 20 hours a week would need to register on a job-search site, with exemptions for students, pregnant women, people in crisis and people eligible for Supplemental Security Income.

The program will reduce the premium payments up to 50 percent for timely payments, a health risk assessment and a physical exam and working at least 30 hours a week.

The state proposal is “overly complex,” creates “new and burdensome bureaucratic hoops,” delays insurance coverage for a year for 400,000 people, cuts coverage for seniors, people with disabilities and pregnant women and imposes unnecessary government mandates, according to the Cover the Commonwealth Coalition, which brought a sizeable contingent to the hearing.

The plan would require far too much administrative red tape, according to Jon Eich of State College, former Centre County commissioner.

It would be simpler just to accept the federal proposal, he said.

“Simpler is better,” Eich said.

The state may actually lose money trying to collect the minimal monthly charges, while giving discounts and imposing penalties, depending on how the patients handle the costs, he said.

Moreover, the state plan will require an intrusive collection of medical data to determine what risk category of plan patients would fit, he said.

The state’s insistence on its plan also forfeits the economic development potential of the federal expansion, which would reduce turnover in low-wage jobs by eliminating the need to seek new jobs with better plans, Eich said.

Moreover, the state plan’s work search requirement may violate federal Medicaid rules, he said.

Also, “bad politics” may help lead to Corbett’s defeat in the fall by providing “ammunition” to his opponents, he predicted.

Federal medicaid expansion would be simpler and timelier, according to Attorney Chava Kintisch of the Disability Rights Network of Pennsylvania.

The state plan will also eliminate the benefits that federal expansion would provide for disabled people to live and work in the community, including those with mental health disabilities, who comprise 40 percent of Medicaid expansion, according to the Disability Rights Network of Pennsylvania.

Both the high-risk and the low-risk plans the state proposes reduce benefits from the current Medicaid levels, according to the network.

Proposed state limits like $2,500 for medical supplies and durable medical equipment for the high-risk plan and $1,000 for the low-risk plan are inadequate – as $2,500 doesn’t even cover the cost of a new power wheelchair, according to the network.

Disabled people can seek exceptions, but those are difficult, according to the network. The use of private insurance to cover those who would have been part of Medicaid expansion will mean the loss of hearings to contest coverage denials and loss of transportation and other benefits, according to the network. And imposition of work requirements and premiums on low-income programs is “punitive,” according to the network.

Some beneficiaries can’t work, some can’t find work, and some can’t get the necessary accommodations to work, according to the network.

Yet Dave Long of Reliant Senior Care – owner of Valley View Home – praised the state plan as “an innovative way to expand health care to lower-income Pennsylvanians without raising taxes and without jeopardizing the care of seniors who are on Medicaid.” The work-search requirement and “very minimal” monthly premiums are “reasonable measures that shouldn’t hold back this innovative plan,” Long said.

Comment closes Jan. 13, after which the state will submit its plan for federal approval.