A thunderstorm rumbled through Frankfort Wednesday as Kentucky Gov. Matt Bevin laid out his sweeping proposal to reshape the state’s Medicaid plan into one he predicts will encourage responsible health choices and teach Kentuckians the basics of paying for health care.
As he spoke in the crowded Capitol Rotunda, a crack of lightning and boom of thunder reverberated through the marble corridors, prompting Bevin to pause.
“God’s weighing in on this,” the governor, a conservative Christian, joked. “He agrees with everything I just said.”
Where the Almighty stands cannot be established. But Bevin’s plan has stirred up a storm among health advocates opposed to changes that would have a profound impact on hundreds of thousands of the 1.3 million Kentuckians on Medicaid — including the 440,000 people added since 2014 under the expansion under the federal Affordable Care Act.
And they are gearing up to fight it during the extensive public comment period required before any action by the federal government, which pays for the majority of Kentucky’s $10-billion-a-year Medicaid program and must approve the changes.
“Harsh new barriers to coverage,” is how Jason Bailey, executive director of the Kentucky Center for Economic Policy described Bevin’s complex plan laid out in a 69-page document released Wednesday.
“I’m very disappointed,” said Bill Wagner, executive director of Family Health Centers in Louisville, a network of community health clinics that has seen a surge in patients with coverage.
The changes “would make it harder for Kentuckians to keep their coverage,” announced the Center on Budget and Policy Priorities, a Washington-based research and policy group that focuses on programs for low-income Americans.
And the Foundation for A Healthy Kentucky, a non-partisan health policy group — while praising some features, such as incentives to stop smoking — said the plan “raises concerns” over its elimination of dental and vision coverage, a projected decline in Medicaid population and the “lock-out” penalty for people who fail to pay new, monthly premiums required by the plan.
The plan predicts Kentucky’s Medicaid enrollment will decline by about 86,000 people by 2021.
Perhaps most significant was the skeptical reaction from the U.S. Department for Health and Human Services, which must approve the “waiver” that Bevin is seeking to allow him to reshape Kentucky’s Medicaid program outside federal rules.
“As we have said many times, Kentucky’s Medicaid expansion has led to one of the biggest reductions of uninsured people in America,” said Ben Wakana, national press secretary for the federal agency. “We are hopeful that Kentucky will ultimately choose to build on its historic improvements in health coverage and health care, rather than go backwards.”
Bevin on Wednesday expressed confidence federal authorities would approve his plan, which includes modest premiums of $1 to $15 a month for people — excluding pregnant women and children — based on their income. But premiums could increase to $37.50 per month for people on Medicaid for five years or more, which “discourages Medicaid dependency,” the plan said.
It would require most “able-bodied, working age” adults to have jobs or other community involvement, such as volunteer work of up to 20 hours a week. The plan says that provision “may reduce poverty” in a state where one-fifth of the residents live below the federal poverty level, an annual income of $24,300 or less for a family of four.
And it would require working Kentuckians who have been on Medicaid for more than a year to move to employee insurance, if available. The state will help subsidize the costs to the employee.
Some of Bevin’s proposals, such as the work requirement, appear unlikely to meet federal approval.
Bailey, in his review, noted work requirements in state Medicaid programs “have been consistently rejected.” Federal authorities rejected a proposed work requirement in Indiana, a state whose alternative Medicaid plan Bevin has cited as an example.
Further, Bailey said, his policy group’s research found the majority of low-income people added to Medicaid under the expansion already work but have low wage jobs or part-time jobs that don’t offer insurance.
A key goal of the Bevin plan is to shift people to employer-based health coverage, but Bailey said an increasing number of employers don’t offer insurance or offer high-cost plans that provide little coverage.
“It’s disappearing,” Bailey said of employer health coverage. “It’s becoming unaffordable. It’s a system that’s slowly falling apart.”
Bevin said his administration has been in discussions with federal officials for six months, right after the Republican governor was elected following a campaign that included pledges to eliminate kynect, the state health exchange launched by his predecessor, Democrat Steve Beshear, and scale back the Medicaid program.
“There is nothing in this that is going to be a surprise to them,” Bevin said Wednesday.
In fact, Bevin suggested at his press conference that if federal authorities reject his plan, he would simply rescind the Medicaid expansion authorized through an executive order by Beshear, an all or nothing proclamation that startled health advocates.
“I’m very concerned that the governor has proposed this as an either or — either approve this or we do away with Medicaid,” Wagner said.
Bevin makes a similar claim in the introduction of the application for the Medicaid waiver for the state plan. The 69-page document “represents the terms under which the commonwealth will continue the Medicaid expansion,” it says.
Whether the federal government will accept the plan or whether Bevin is willing to make any concessions remains to be seen. Approval for such waivers in a handful of other states that have adopted them have taken months or years.
But the state is likely in for more stormy weather as the governor proceeds with a plan he says will re-invent Medicaid in Kentucky, but one that advocates believe will undermine it.
Information on how to comment on the plan is on the website of the Cabinet for Health and Family Services, chfs.ky.gov.
Deborah Yetter is a reporter who covers social services for The Courier-Journal. Contact her at (502)582-4228 or firstname.lastname@example.org.