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Feds OK Utah’s Medicaid expansion with restrictions

State’s fallback plan includes ‘community engagement requirement’ to receive benefits

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In this Jan. 28, 2019, file photo, Bonnie Bowman, a supporter of a voter-approved measure to fully expand Medicaid, gathers with others during a rally at the Utah Capitol, urging lawmakers not to change the law. On Monday Utah received federal approval to fully expand Medicaid, with some controversial limitations including a work requirement.

AP

SALT LAKE CITY — As an advocate on Monday learned that what she’d fought for in Utah for several years had been achieved — a full Medicaid expansion — she became emotional.

After a serious car crash in 2010, Stacy Stanford found herself in the “coverage gap” of those who are ill or disabled but can’t access care.

“So this is really personal for me. And through the years in working on this issue, I have met a lot of people like me and a lot of people who are no longer with us,” the policy analyst for nonprofit Utah Health Policy Project explained.

Several people she got to know in her position died while waiting to receive coverage, Stanford said.

“And I don’t have to tell that story anymore. We call it the coverage gap because there’s a real gap between those with access to care and those without. And that gap in Utah has been so real. ... And this announcement today is just huge, because that huge gap in Utah finally has a sturdier bridge over it,” she said.

“It’s still not perfect, we still have work requirements which are a huge missing plank in that bridge. But we’re so much closer, finally. And this is what all of Utah was fighting for,” Stanford said.

Utah on Monday received federal approval to fully expand Medicaid, with some controversial limitations including what the state calls a community engagement requirement. On Jan. 1, those making up to 138% of the federal poverty level — $16,753 for an individual or $34,638 for a family of four — will be eligible, the Utah Department of Health announced.

“(The Centers for Medicare and Medicaid Services’) decision is evidence states can craft viable, unique solutions to deliver critical health care services to their residents,” Gov. Gary Herbert said in a statement.

“I want to thank CMS Administrator Seema Verma, along with her dedicated staff, who worked quickly and diligently to approve this request and allow us to expand within the parameters set by our state law,” he added.

Medicaid recipients — except for pregnant women, people over 60 and some other exemptions — will need to fill out an online job assessment, complete workshops and provide evidence that they’ve applied for at least 48 jobs within three months or see their benefits terminated, the department said.

The health department estimates that between 70% and 80% of recipients will be exempt from the community engagement requirement, according to spokesman Tom Hudachko.

Newly eligible adults will also be required to enroll in employer-sponsored insurance when offered.

Though advocates expected the fallback plan would be approved, the timing of it so soon after the plan was submitted in November came as a surprise.

“This is a great Christmas present for Utah,” Stanford said, expressing gratitude to Herbert for asking the federal agency to approve the waiver by the end of the year.

At a recent Health Reform Task Force meeting, some debate had centered around whether the federal government would approve a waiver containing a work requirement, as other states have seen their work requirements blocked by federal judges.

Among them, Arkansas, Kentucky and New Hampshire’s work requirements were nixed by a judge who said they go against Medicaid’s purpose of helping the needy, the Associated Press reported.

But Rep. Jim Dunnigan, R-Taylorsville, said Monday those states’ programs required proof of hours worked. Though some critics of Utah’s requirement call it a “work requirement,” he said, the federal government considers it a community engagement requirement.

“I don’t want people to come away thinking it’s a requirement that they have to work. They have to make an effort one time a year to apply for work. That’s what it is. We consciously made that decision. We had the decision when we worked on the legislation this past session, we had the choice of either having a work requirement or community engagement,” Dunnigan told the Deseret News.

“We want to help people. Right now, there are plenty of jobs out there, and so we want to help them find work,” he said.

Those receiving food stamps already need to provide proof of applying for jobs, Dunnigan explained.

Nevertheless, Stanford said, the community engagement requirement will be an added burden for some who already come from working households, or are too sick or disabled to work.

“There’s a big asterisk attached to this full expansion, because this work reporting requirement is a paperwork barrier for people who have been waiting so long to get access to health care. Now, they finally qualify if they check the right boxes and turn in the right forms, and cross these hurdles in order to get the care they need,” she explained.

She called the requirement to fill out 48 job applications — and submit proof of them to the state — “absurd.”

“It catches people and cuts off their care, even if they aren’t, you know failing to meet the eligibility requirements,” Stanford said.

Though she said advocates understand the desire not to give benefits to those who aren’t trying to find work and improve their own lives, others who are trying will suffer as result of the requirement.

While expressing happiness for those who will now receive coverage, Alliance for a Better Utah also criticized the community engagement requirement.

“The bad news is that this expansion continues to be based on the harmful, conservative ideologies of a majority of our Legislature, rather than the compassionate plan that was passed by a majority of Utahns,” Chase Thomas, executive director of Alliance for a Better Utah, said in a statement.

“Although over 100,000 Utahns are now eligible for Medicaid, the bureaucratic hurdles imposed by new work requirements could prove to keep otherwise eligible individuals and families from receiving the medical coverage they need. In addition to violating the compassionate spirit and intent of Proposition 3, we’re sure that Utah courts will agree with courts in Kansas and Arkansas that have found work requirements violate the intent of the Medicaid program,” he said.

Gov. Gary Herbert’s office issued a statement Monday in defense of the self-sufficiency requirement.

“In Utah, the average time people spend on Medicaid is between nine and 11 months. This is a relatively short period of time because we have many resources available that actively engage in helping people in these programs prepare for and find better jobs. We believe this is the best way to help people out of poverty, and that by creating pathways that pave the way to a better future, we do more than simply provide for immediate needs,” Anna Lenhardt, Herbert’s communications director, said in the statement.

“The ‘work requirement’ in this program is flexible, charitable and provides a great number of exceptions to those who are physically or mentally unable to work. We believe this program will help vulnerable Utahns rise out of difficult situations,” she said.

Utah submitted its fallback plan after receiving an informal rejection for its more limited bridge plan that covers those making up to 100% of the federal poverty level.

“We are in constant discussions with (the Centers for Medicare and Medicaid Services) working toward answering any questions they have related to that proposal,” Nate Checketts, director of the Medicaid program for the Utah Department of Health, said at the Health Reform Task Force meeting.

Nearly nine months into partial expansion, more than 40,000 people are enrolled under the “bridge” plan — including nearly 5,000 targeted adult Medicaid recipients, 12,000 parents, and 23,000 adults without dependent children, according to Checketts.

After receiving approval for its fallback plan, an additional 40,000 people currently buying insurance on the federal marketplace are now eligible for Medicaid.

If someone receiving insurance on the marketplace becomes eligible for Medicaid under the 138% expansion — and if they change their benefit plan or update their income — a review will be triggered by the federal marketplace to determine whether they’re eligible, and refer them to the Utah Department of Workforce Services for a determination, Checketts said.

Now, up to 120,000 Utahns who weren’t eligible at the beginning of 2019 will be able to receive Medicaid, according to the health department.

Dunnigan said the plan also includes eligibility for victims of domestic abuse and those undergoing court-ordered substance use disorder treatment for 12 months.

Utah voters in 2018 approved a ballot initiative to expand Medicaid, but state lawmakers said the plan was financially unsustainable and delivered a different plan, including four phases. The first two that sought to expand Medicaid to 100% of the federal poverty level have been rejected by the Centers for Medicare and Medicaid Services on the grounds that the entire Affordable Care Act is under threat in the court system.

Currently, Utah has been paying 30% of the program costs, with the federal government providing a 70% match under the partial expansion plan. Under the full expansion, the state will now receive a 90/10 match.

“This approval is very important for our state budget so we can begin receiving the higher federal match for these services. We look forward to working with (the Centers for Medicare and Medicaid Services) to obtain approval of the remaining components of our request so this expansion has the additional supports and cost controls we envisioned,” Dunnigan said.  

According to expansion bill SB96 — passed as an alternative to full expansion called for by voters under Proposition 3 — the state had to work through a couple of options before Medicaid would be fully expanded. If those proposals were not approved by U.S. Centers for Medicare and Medicaid Services by July 1, 2020, the health department would have been required to institute full expansion in Utah, increasing eligibility to those making between 100% and 138% of the federal poverty level under the Affordable Care Act without the limitations included in the fallback plan.