It’s no secret that the road to affordable health care for all citizens has been a rocky one. Reports of glitches in the federal government’s health insurance exchange website and negative side effects of the new law, especially in relatively low population states like Wyoming, are rampant in the national news.
In the state of Wyoming, one of the few states in the union that mandates a balanced budget, lawmakers continue to reject the idea of Medicaid expansion and refuse to set up a state run exchange citing the costs of such programs and lack of confidence in the federal government’s promise to subsidize such programs. Lawmakers continue to express there frustration as the rules of the new law creates problems rather than solutions for many of Wyoming’s critical access hospitals.
“Until they (the federal government) get the exchange up and running 100 percent there will be glitches,” said Rep. Elaine Harvey of Lovell. “If people do not have insurance and think they are eligible for subsidies they really need to go on health.gov and see if they can get through. Some have been able to get through but many have not.”
Harvey said that as the traffic on the site picks up, so does the wait time. Government subsidies, which help pay for the cost of purchasing health insurance, are only available through the exchange and are based entirely on income. For those who are able to get through, the government website automatically calculates the subsidy based on income information, family size and geographical location.
According to Harvey, there are parts of the site that are working, but there are still many glitches. For that reason, the federal government just extended the enrollment deadline this month from Dec. 23 to the Dec. 31 for those wishing to purchase on the exchange in order to be enrolled in an insurance plan effective Jan. 1, 2014.
“They’re trying to do whatever they can to live within the law itself and make it work for people,” said Harvey, who expressed skepticism about whether the law can be successfully implemented as written.
Since enrollment through the exchange can only take place during a specific enrollment period that started Oct. 1 and ends March 31, individuals who wish to be enrolled through the exchange must be enrolled by March 31. Coverage is not retroactive so, for example, an individual or family enrolled on March 31 is not covered for the months prior to their enrollment in the program. Those who are not enrolled by March 31, according to the current rules, will not have an opportunity to purchase insurance through the exchange until the next open enrollment period, which begins on Oct. 1, 2014. Of course, anyone can purchase insurance directly through an insurance company, but policies purchased directly from an insurance carrier will not be eligible for the government subsidy.
There is no penalty for failing to have a policy in place during the first year of the law, but penalties gradually increase over time. The penalty is a percentage of income and could go as high as 7.5 percent of income, said Harvey. The penalty, when enacted, will be enforced by the Internal Revenue Service through income tax returns.
Harvey pointed out that people can still expect to have out-of-pocket costs connected with medical expenses even if they are insured through the exchange or directly with a carrier, and she noted that the average out-of-pocket figure for the “Silver” or mid-range plan is about $6,500 a year per individual. This cost is for deductibles, percentage of co-pay and other expenses connected with any type of policy.
Gov. Matt Mead held firm earlier this month in his position of not supporting Medicaid expansion in the state of Wyoming at this time. Harvey said the Wyoming Legislature “feels the same way.”
“If you look at what Congress is doing right now, they are looking at what they can do to cut programs and cut payments,” explained Harvey. “Their focus right now is to begin the balance of just paying the bills. I think the goal right now is to just quit borrowing money, not to spend more money.
“Many of us here in Wyoming see this health care law as unsustainable. When you add up what the federal government plans to subsidize people to sign up on the exchange and the cost of expanding Medicaid, there is no way they can afford to pay for the expanded group of newly eligible people on Medicaid. They say they are going to and as long as this administration is in power, they will continue to print money to do it. We don’t agree with that policy.”
Harvey noted that many in Wyoming government agree with the governor that the federal government won’t be able to make these payments over time and that the state will eventually be burdened with the costs.
“It’s a double-edged sword. Right now a lot of people characterize it as free money from the government, but it’s not free,” explained Harvey. “It’s money we pay in taxes.”
Harvey said she is especially against the idea of putting people on Medicaid and then later having to pull them off the plan because the federal government is unable to fulfill its partnership with states in terms of paying for the expansion. She said that people will be looking at that point for the state to foot the bill because they have “grown accustomed” to having Medicaid. She said that she and others in the legislature feel that the state won’t be able to take on that burden.
“What it comes down to, is that we don’t want to start something, or make a promise that we can’t keep,” said Harvey.
Harvey said that legislators are visiting with lawmakers from Arkansas and Iowa this month to review an alternative plan in place in those states that is an alternate to the Medicaid Expansion program called an “1115 waiver.” She explained that the program actually takes people off of Medicaid and puts them on private policies, grouping them into unique family groups that partner with the exchange group, creating more of a balance in the cost of services.
“There are big benefits to this type of program because people will have better access to healthcare because more providers will accept people with health insurance than they will accept people on Medicaid,” she explained. “It also gives them upward mobility, so if someone gets a better paying job, they don’t lose benefits. They still get to keep the policy, just the payer changes from Medicaid to a partial from their employer or a subsidy.”
She noted that having the insurance companies control costs and handle the paperwork in itself is a savings to the government. She said hospitals benefit from this type of “premium assistance plan” because they will be reimbursed at an insurance rate, not a lower Medicaid rate, and uncompensated care will go down.
Harvey pointed out that some of the high cost patients, the aged and disabled would most likely still stay on Medicaid. The waiver would simply offer an alternative to expanding Medicaid to those beyond those already existing categories. In the state of Wyoming, that includes about 30,000 people, who would be added to the Medicaid rolls if the expansion program is implemented.
“We are trying to not re-create the wheel but instead to learn from states like Arkansas and Iowa who have already implemented the alternative plan,” said Harvey. “We’d like to see how they did it and if it’s working before we consider it for our state. The commonality with have with both of these states is the rural population.
“Even though they have metropolitan centers, they still have many people living in rural areas just like we do, using critical access hospitals and an insufficient number of medical providers to serve their needs. We’re very fortunate in Lovell because our doctors and medical providers do take Medicaid, but that’s not the case in other parts of the state.”
By Patti Carpenter