Pennsylvania will have to move children below 133 percent of the poverty line from its Children’s Health Insurance Program to Medicaid, according to a letter from HHS Secretary Kathleen Sebelius to GOP Governor Tom Corbett offering some flexibility after Corbett objected to shifting the estimated 50,000 children. The state continues to resist the ACA-required move but is reviewing its options, a state official tells Inside Health Policy. At the same time, state officials reportedly are looking more seriously at future Medicaid expansion and reform possibilities.
Several sources said that Rep. Joseph Pitts (R-PA) was considering calling a hearing on the issue, but a source on Capitol Hill says nothing is scheduled at this time.
The letter from Sebelius applies to all states, though it notes that many states have already corrected the age eligibility differences. She says ACA makes this change nationwide Jan. 1 and simplifies coverage for families. Sebelius told Corbett there are ways the state could implement the transition over a period of time, and several options exist, including a phased-in transition that would stagger enrollment to first transition families enrolled with overlapping providers and health plans. The state could also structure its child health programs so that while coverage would technically be available through two different programs, families would experience one coverage system that looks like the CHIP program but has Medicaid benefits and cost-sharing obligations. A spokesperson for the Pennsylvania Insurance Department said state officials are examining these options.
Pennsylvania’s CHIP program previously allowed children under the age of six in the program if family income was below 133 percent of the poverty level, but the requirement was below 100 percent of the poverty level for children six and older, meaning that children would have to move from CHIP to Medicaid after their sixth birthday. The Affordable Care streamlines this — all children who are below 133 percent of the poverty line will have to move to Medicaid, and CHIP will continue to serve 133-300 percent levels. Children moved to Medicaid will incur the same 50 percent matching rate that they currently do for the state government under CHIP
The Pennsylvania Insurance Department spokesperson said the state opposes the change because provider networks under Medicaid are not as rich as offered under CHIP, and that private insurance is more involved in the CHIP program because it is based on the private insurance market. However, Aetna, Geisinger, Health Partners, United and UPMC Health Plan offer both CHIP and Medicaid plans in Pennsylvania, out of the nine total CHIP insurers. She said children might have to switch doctors if the switch is made, which would cause confusion.
Judith Solomon, VP for health policy at the Center on Budget and Policy Priorities, said that notion is hard to give credence to because children under the current CHIP program would have to move to Medicaid and possibly providers when they turned six and were above the 100 percent poverty line.
“When you think about it from a family perspective, to say that when you turn six, you should go into a different program, and leave younger siblings in the other, it’s hard to understand,” Solomon said. “If you’re saying CHIP is better, then make your Medicaid program better. If that’s the reason, it’s a hard reason to accept.”
Philadelphia-based Công dân cho trẻ em và thanh thiếu niên said that while Corbett had initially opposed the switch because it would shrink CHIP to such a small size that it would not be feasible to operate, the size of the remaining children under CHIP in Pennsylvania would be larger than CHIP enrollment in 37 states, according to the Kaiser Family Foundation.
Pennsylvania Insurance Commissioner Michael Consedine has talked about the possibility of bringing the issue to court, but Executive Director Donna Cooper of PCCY said that the state would not be able to justify the legal expense and it would not be able to demonstrate an unfair burden. Ultimately, the state will have to comply with the federal law.
She said the main argument, that the networks are not as robust within the Medicaid plan as CHIP, could be amended because five of the same CHIP insurers are also Medicaid insurers and could work to build up networks using existing providers. If there are regions where there are not as many Medicaid providers, the state could work to add more providers to its roster.
She says that Corbett has yet to come up with a valid reason for opposing the switch, and that the real reason may be political.”I assume that there are individuals in the governor’s office that are nervous about cooperating with any elements of the Affordable Care Act — if they oppose this, they can stay pure, but it hurts children. I have to assume it’s ideological vs. a policy stance,” she said.
Attorney Deborah Bachrach, with Manatt, Phelps & Phillips, said that the intent of switching
children under 133 percent to Medicaid was that if states do decide to expand Medicaid, adults in the same family will be under the same program albeit with slightly different benefits. The Philadelphia Inquirer reported on Tuesday that Corbett is more seriously considering Medicaid expansion, but believes that the Medicaid program would have to reformed first, which consumes 27 percent of the state’s general fund budget. The expansion would include around 500,000 people, and the federal government would pay 100 percent for three years starting Jan. 1, gradually declining to 90 percent.
“It’s part of a vision for low income families because if a state that expands, then you have
families covered by the same program when family income is below 133 percent of poverty level,” Bachrach said in an interview, referring to the ACA’s CHIP and Medicaid policies. She also said that the switch should not cost states much more because of the extended cost sharing by the federal government to Medicaid.
Many children’s advocates are supportive of this part of the law, not only because the benefits package is more comprehensive, but cost sharing can be more constrained and the preventative care benefit Early and Periodic Screening, Diagnostic, and Treatment is mandatory under Medicaid and not CHIP.
Carrie Fitzgerald, senior policy advisor for health at First Focus, a bipartisan children’s advocacy group, said that the main issues — the provider networks and payment rates not being as high — can be amended by the state itself.
“It’s important for policy makers to be reminded that they do have control over Medicaid in their program — there are eligibility rules, but they do have control over reimbursement rates, growing provider networks and some states have done that,” by increasing payment rates and extending access to Medicaid providers, she said.
The Daily News – September 17, 2013 – Get PDF of article