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Idaho panel: Expand Medicaid to cover more poor

Gov. C.L. “Butch” Otter and the Legislature should broaden Idaho’s Medicaid program to cover more than 100,000 additional low-income residents, but insist on tying the expansion to a benefit program that improves care, boosts personal accountability and reduces costs.

That was the unanimous recommendation Nov. 9 from a 15-person panel that’s met since early summer to analyze costs and benefits of expanding Medicaid eligibility to cover people earning up to 138 percent of the federal poverty line. It’s a key provision of President Barack Obama’s health insurance overhaul, but one the U.S. Supreme Court left up to states to decide.

A Seattle-based actuarial firm told the group before it voted Nov. 9 that Idaho will save $6.5 million through 2024 if it expands Medicaid eligibility – and suffer costs of $284 million by rejecting it.

That’s because nearly all of the new costs of covering people newly eligible for Medicaid – mainly low-income adults without children at home – would be borne by the federal government. Rejecting expansion, by contrast, would mean state and county property taxpayers would likely simply continue funding Idaho’s existing Catastrophic Health Care program that’s due to run $61 million in 2014 to cover the indigent population’s medical bills.

“The county indigent program has run its course,” said Dan Chadwick, a lobbyist for the Idaho Association of Counties and a panelist. “It does not work. It’s become administratively and financially unsustainable.”

The group’s members, including doctors, hospital and medical association lobbyists, and representatives from Idaho businesses, said any expansion of Medicaid can’t be merely a blank check to continue the programs of the past.

Rather, it should be tied to creating a benefit program for the newly covered that incentivizes personal responsibility – and reworks a medical culture where low-income patients and medical providers have too few incentives to reduce costs, improve care and boost the health of the working poor.

“If we don’t do this, we do cripple Idaho, in many ways,” said Ted Epperly, a Boise medical doctor and director of the Family Medicine Residency Program in Idaho.

In July, the U.S. Supreme Court upheld the constitutionality of Obama’s Patient Protection and Affordable Care Act. Under the law, Washington will pay 100 percent of the costs of expanding Medicaid from 2014 to 2016; between 2017 and 2020, the federal share will decrease to 90 percent and the states’ contribution would rise in stages.

But justices threw in a twist: Obama couldn’t force states to expand their Medicaid programs’ eligibility by threatening to withhold federal funding.

That’s why Otter appointed this group: To weigh factors including cost, savings and how any decision would affect important principles like personal accountability before giving him guidance on what to do.

Idaho isn’t alone in wrestling with the question.

Though most states are likely to go along with the expansion, leaders of some largely conservative bastions have refused, including Mississippi, Florida, Louisiana, Georgia, South Carolina and Texas. Some argue it is too expensive – regardless of Washington’s promise to pay for most of the new coverage.

The Idaho group’s recommendation will go to Otter in coming weeks, said Department of Health and Welfare Director Dick Armstrong. That will be in time for the Republican governor to prepare a proposal for the 2013 Idaho Legislature, where a majority of GOP lawmakers have been skeptical of adopting any part of Obama’s overhaul.

“We don’t do this independent of” lawmakers, Armstrong said.

In addition to the panel’s recommendation to expand Medicaid, Otter is also wrestling with a separate one from another task force on how Idaho should craft an insurance exchange, the online marketplace for individuals and small businesses to shop for insurance that’s also part of Obama’s overhaul.

In late October, the panel told Otter to go with a nonprofit, state-based exchange, rather than having the federal government administer the program.

Otter can’t dally: On Nov. 16, Idaho and other states must notify Washington of their plans.

Otter will be in Las Vegas from Nov. 13 until Nov. 15 to attend a Republican Governors Association meeting, but his spokesman Jon Hanian said it’s on his mind.

“He has not made a decision yet, but he’s very cognizant of the fact there’s a Nov. 16 deadline looming,” Hanian said.

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