States choosing to expand their Medicaid programs must broaden Medicaid eligibility to the full extent laid out in the healthcare reform law in order to get full federal matching funds to help pay for the new coverage, HHS announced Monday.
That directive came during a call with reporters when acting CMS Administrator Marilyn Tavenner said “there is not an option for enhanced match” for a partial or phased-in expansion. Instead, the law requires that the federal matching rate be used to expand Medicaid coverage to those earning at or below 133% of the federal poverty level. Under the law, states will receive 100% support from the federal government for newly eligible adults from 2014 through 2016. Then the match gradually declines until 2020, when it will hit 90% and remain at that level.
Medicaid expansion has been a complicated and contentious issue for governors after the U.S. Supreme Court decided in June that states could decide on their own if they would expand their programs. The explanation on the match was also laid out in a 17-page letter from HHS Secretary Kathleen Sebelius (PDF) to the nation's governors that included answers to nearly 40 of the most frequently asked questions HHS has received about the Medicaid expansion and state health insurance exchange provisions in the 2010 federal healthcare overhaul.