Medicaid expansion fights in GOP states will continue in 2016

The struggle to persuade Republican state officials across the country to expand Medicaid to millions of uninsured, low-income adults under the Affordable Care Act will continue in 2016, even as GOP presidential candidates heading into the November elections promise to repeal the law.

Meanwhile, Medicaid managed-care plans, providers and patient advocacy groups will be watching anxiously to see how the CMS plans to tighten oversight of Medicaid plans in its sweeping regulations expected to be released this spring.

Under new Democratic Gov. John Bel Edwards, Louisiana is expected to be the first state to seriously pursue Medicaid expansion in 2016, though the Republican-controlled Legislature wants to hear how it will be financed when states have to pick up a small percentage of the expansion funding starting in 2017. More than 300,000 Louisianans could qualify for coverage, and the state's hospitals are eager for quick action. So far, 30 states plus the District of Columbia have expanded Medicaid.

Next up could be South Dakota, where Republican Gov. Dennis Daugaard has included Medicaid expansion in his proposed budget. But he has acknowledged it will be an uphill battle persuading the GOP-controlled Legislature. Alabama Republican Gov. Robert Bentley has said his administration is considering expansion through a state-specific waiver model.

On the other hand, there could be some setbacks for expansion supporters in states that previously extended coverage. Arkansas' Republican leaders are considering asking the Obama administration to let the state impose premium payments, coverage lockouts for nonpayment, asset tests and work requirements. In Kentucky, newly elected Republican Gov. Matt Bevin, who campaigned on a promise to roll back the Medicaid expansion, has suggested he also would like to add personal-responsibility features such as premium payments and lockouts to the state's program.

And in Michigan, state Republican leaders will have to decide whether the Obama administration's revision of their Medicaid expansion waiver proposal goes far enough in making beneficiaries more personally responsible. Patient advocacy groups are nervously watching how far the administration is willing to go in approving these states' waiver proposals, which they warn will reduce enrollment.

On Medicaid managed-care regulation, the CMS' proposed rules would cap how much premium revenue plans could allocate for administration and profit; require states to more rigorously supervise the adequacy of plans' provider networks; encourage states to establish quality rating systems for plans; allow more behavioral healthcare in institutional settings; and encourage the growth of managed long-term care. About 73% of beneficiaries receive coverage through managed-care plans, according to consulting group Avalere Health.

Another key issue in 2016 will be the fate of the Obama administration's 12-state demonstration to better coordinate coverage and care for people who are dually eligible for Medicaid and Medicare. So far, participating health plans have struggled with high rates of beneficiaries choosing not to participate and with resistance from providers. There are questions about how many states will extend their participation after the initial three-year demonstration period.

Many will be watching California, where Gov. Jerry Brown said in his budget proposal that the program was costing the state rather than saving money. He said, “If these factors are not improved by January 2016, the (demonstration) would cease operating effective January 2017.”

Jeff Myers, president of the trade group Medicaid Health Plans of America, said that if California ends the program, “it would be a signal that the dual demonstrations are a failure.”