Georgia lawmakers appear poised to take action to address Georgia’s ongoing health care crisis following nearly seven years of debate over accepting additional federal funding to increase access to health insurance for hundreds of thousands of Georgians. There are currently two major paths before lawmakers — straightforward expansion or reform through federal waivers.
This week Gov. Brian Kemp submitted legislation to the General Assembly, Senate Bill 106, that would authorize the Governor’s Office and Department of Community Health to submit two major health insurance reform proposals for federal approval opting for a waiver path over a straightforward expansion.
Gov. Kemp proposes a combination of an Section 1115 waiver to increase eligibility for the state’s Medicaid program and a Section 1332 waiver to reform the state’s individual health care marketplace established as part of the Affordable Care Act. The federal government granted eight states 1332 waivers to improve the efficiency and effectiveness of their existing marketplaces. And 36 states, along with District of Columbia, expanded Medicaid or pursued an 1115 waiver increasing eligibility up to 138 percent of the federal poverty level. An abundance of research clearly demonstrates that a well-crafted 1115 Medicaid waiver plan can increase coverage and help introduce innovative approaches to delivering care.
Unfortunately, the parameters presented under the governor’s new effort – dubbed the ‘Patients First Act’ – fall far short of comparable proposals to draw down increased federal funding for Georgia’s Medicaid program. Most problematic is the plan’s unprecedented attempt to limit eligibility to just 100 percent of poverty and still receive enhanced federal matching dollars. That proposal design has been denied twice by the federal agency that evaluates 1115 waivers.
The governor’s proposed 1115 waiver would only allow for an increase in Medicaid income eligibility to 100 percent of the federal poverty line, instead of the 138 percent that is required to receive increased funding under the Affordable Care Act. Only 240,000 Georgians would qualify under the proposed partial expansion to 100 percent of poverty. Also, the state would have to pay for the new enrollees at the current federal matching rate of 67 percent, instead of the higher 90 percent match that comes with a full expansion. This ultimately would cost Georgia more to offer health insurance to fewer people. Massachusetts, Arkansas and Utah requested a partial expansion waiver, and to date no state received approval from the federal government to implement a partial increase and still receive the higher federal match. Pending still is Utah’s proposed partial expansion that is estimated to cost $50 million more to cover 48,000 fewer people. Georgia should not pursue a path that would cost the state more to cover less people.
Today, hundreds of thousands of Georgia veterans, parents and low-wage workers make too much money to qualify for Medicaid and have limited or no health coverage options through their employer or the health insurance marketplace. Straightforward Medicaid expansion would increase the income eligibility for Medicaid to 138 percent of poverty, about $16,000 a year for an individual and $28,000 for a family of three. About 470,000 Georgians would be eligible for health coverage under full Medicaid expansion, and the state auditor’s office estimated the net cost would be about $140 million next year. That figure includes anticipated new state revenue and cost savings to agencies that provide services for the uninsured. The federal government would cover 90 percent of costs in 2020 and every year after that, bringing about $3 billion federal dollars back into the state each year to pay for health care services.
Georgia’s heath care system is at a critical point. As a worsening rural health crisis threatens to leave more communities without providers and access to basic services, the state’s uninsured rate stands as the fourth-highest in the nation. There is near-universal agreement that the state faces an urgent need to provide affordable health coverage options to more Georgians, while helping rural hospitals struggling under the burden of high uncompensated care costs and the changing health care financing environment.
It is promising to see that the debate over how to best use a waiver to get more Georgians covered is now at top of the General Assembly’s agenda. Any Medicaid waiver proposal must ensure the plan increases access to health coverage and is a good and sustainable fiscal deal for Georgia. The current Patients First Act requires more work to get the best return for Georgia.
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Laura Harker, policy analyst, Georgia Budget and Policy Institute.