Some 160,000 Colorado adults with low incomes could become eligible for public healthcare assistance under a plan announced Thursday by Gov. John Hickenlooper.
Hickenlooper's plan expands Medicaid coverage for adults as called for by President Barack Obama's federal healthcare law.
Hickenlooper said the expansion would cost Colorado some $128 million over the next 10 years. But he says he has identified more than $280 million in cuts and savings to Medicaid to more than pay for the change.
Those cuts and savings include better use of technology by Medicaid-funded doctors, renewed efforts to reduce waste and a continued move toward wellness goals. That means patients on Medicaid could see more opportunities for help with weight loss or smoking cessation, enhancements believed to save money in the long run.
The expansion proposed Thursday would allow single adults earning less than about $15,400 a year to receive Medicaid. State analysts believe that more than 750,000 people in Colorado — or about 15 percent to 16 percent — didn't have health insurance in 2011, the most recent figures available.
At least 14 states and Washington, D.C., already have indicated they would try to expand Medicaid, a signature goal of the new health care law. Governors in nine states have said they won't participate. A Supreme Court ruling last summer made the Medicaid expansion voluntary for states, rather than mandatory.
The Medicaid overhaul is one of the two main ways the federal health law expands coverage to most of the 50 million uninsured U.S. residents.
As a broader Medicaid safety net picks up more low-income people, new health insurance markets, called exchanges, will offer subsidized private coverage to the middle class.
Both parts of the strategy take effect in 2014, at the same time that most Americans will be required to carry health insurance or pay a fine.
Hickenlooper's price tag for his Medicaid proposal is a dramatically lower than what outside groups have projected.
A joint report last year from the Kaiser Family Foundation and the Urban Institute said Colorado would have to spend up to $858 million over the next 10 years on the Medicaid expansion. Hickenlooper and his budget analysts argued Thursday that the $858 million is way off base because it doesn't account for how Colorado uses tobacco settlement money and other revenue sources.
Susan Birch, head of Department of Health Care Policy and Financing, said the larger figure "used a template that doesn't work for the state of Colorado."
The governor said he's confident in his projection..
Hickenlooper's proposed changes will likely face scrutiny by the state Legislature, which begins work next week. The governor seemed confident lawmakers would agree to his plan.
"We're going to have a relentless focus on, how do we contain costs," he said.