2013 General Session opens

Legislature has opportunity to insure thousands

Medicaid Expansion will save General Fund $47.4 million

The 62nd Legislature swore in its new members and new officers Tuesday, opening a session which presents an historic opportunity to secure the health of thousands of Wyoming residents who presently have no health insurance. It looks doubtful whether the Legislature will take the opportunity offered by the Medicaid Expansion program authorized under the Affordable Care Act. New Speaker Tom Lubnau urged caution in his opening remarks to the House Tuesday. Speaker Lubnau said the state could be “hooked” by the federal government into providing care that will be expensive and implied the state should wait to take action. Democratic Minority Leader Mary Throne of Cheyenne disagreed sharply. She pointed to the $47.4 million in savings to the state’s General Fund that the Medicaid Expansion promises between 2014 and 2020. She noted that state hospitals provided $200 million in uncompensated care in 2011. Those costs are shifted to paying customers through higher charges and higher insurance premiums. “We all pay the tab,” she said. Wyoming Department of Health Director Tom Forslund revealed the potential savings in an analysis of the Medicaid Expansion available to all states under the Affordable Care Act (ACA). Last month, the director presented his analysis to the Joint Appropriations and Labor, Health, and Social Services committees in separate meetings. Wyoming’s current Medicaid program is jointly funded by the federal government and the state’s General Fund, which split the cost equally. The ACA, Forslund noted, will result in higher costs to the state without Medicaid Expansion. The ACA is expected to bring out of the “woodwork” about 3,700 people who currently qualify for Medicaid but have not signed up. The state will split the $106.6 million cost of covering them from 2014 to 2020. The ACA requires the state to provide Medicaid to about 6,900 “newly eligible” children. The federal government will pay 65% of those costs, about $73.4 million. The state will pay about $42.2 million to cover the cost of ensuring them. Covering both the “woodwork” population and the newly eligible children is mandatory. So how can the Medicaid Expansion save the state $47.4 million? Under the ACA, the federal government, in 2014, 2015, and 2016, will pay 100% of the cost of ensuring about 17,600 newly eligible adults, most childless adults with incomes equal to just 138% of the Federal Poverty Level. The federal share then declines in annual steps to 90% of the cost by 2020. Forslund said it will cost the federal government about $737.8 million to cover the Expansion population. The state would pay about $35.7 million in premium costs from 2017 through 2020. Add in $15.5 million in administrative costs, and the total cost to Wyoming’s General Fund is $51.2 million. But that Medicaid insurance means those 17,600 people will no long need state subsidized care now available to them through programs such colorectal cancer screening, renal dialysis, or behavioral health services, among others. These “offsets” will save the state $198.5 million, Forslund found. Total cost to the state of the mandatory and Expansion populations will be $151.1 million. Subtract that from the $198.5 million in offset General Funds costs, and there’s your $47.4 million in savings. It should be noted that no legislator has challenged the numbers in Director Forslund’s analysis. The question is whether doubts of the federal government’s trustworthiness will stop legislators from taking a major step forward with health care in Wyoming. Oh, and one more thing: most of the newly eligible adults are working people. The just don’t have jobs that either offer health insurance or pay well enough to allow them to buy insurance in the private market.

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