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Federal Government Starting To Question Bevin's Medicaid Proposal

J. Tyler Franklin

The federal government has given its most forceful statement yet in response to Gov. Matt Bevin’s proposal to apply for a waiver to change Kentucky's Medicaid system.

Bevin’s plan, which requires federal approval, would make most Medicaid recipients pay monthly premiums, eliminate vision and dental coverage and institute a credit program whereby individuals could get better coverage by volunteering or applying for a job.

At a forum hosted by the Health Enterprises Network on Thursday, Bevin’s deputy chief of staff Adam Meier said that the administration had little doubt the federal government would accept the plan.

"We're pretty confident they'll approve our waiver or something pretty close to it," Meier said, according to the Courier-Journal.

In response, Ben Wakana, press secretary for the U.S. Department for Health and Human Services, said in an email that during talks with Bevin’s administration, the department has “repeatedly been clear” about “principles of access to coverage and affordability of care.”

“Among these principles, states may not limit access to coverage or benefits based on work or other activities, nor may they impose premiums or cost sharing that prevent low-income individuals from accessing coverage and care,” Wakana wrote.

Bevin’s proposal would require individuals pay premiums ranging from $1 to $15 per month based on how much they make. It would “lock out” beneficiaries from coverage if they don’t pay, with opportunities to regain benefits by taking a financial literacy class and paying what they owe.

The plan would also allow people to earn vision and dental benefits through “community engagement.” Beneficiaries would be awarded credits for volunteering, taking classes and applying for or getting a job that could be exchanged for additional benefits.

In response to Wakana’s statement, Bevin’s press secretary Amanda Stamper said the Medicaid statute “provides full authority for the Secretary of HHS to approve our waiver.”

“There is nothing in the law that prohibits a community engagement requirement,” Stamper wrote. “The current Medicaid expansion is fiscally unsustainable for the Commonwealth. Governor Bevin has put together a thoughtful reasonable plan to improve the health and economic condition of the state.”

The governor’s office estimates that if approved, the Medicaid waiver would save the state about $331 million over the next five years.

Though the federal government has fully subsidized Medicaid expansion since it rolled out in 2014, the state will have to start paying 5 percent of the cost starting this fiscal year, and Kentucky’s share will eventually increase to 10 percent.

The state estimates expansion costs will be about $1.2 billion over the next five years if nothing is changed.

The governor’s office said Kentucky’s Medicaid expansion will be repealed if the federal government doesn’t approve the waiver. Stamper maintains that any blame for that move would be on federal officials.

“Therefore, continuation of the Medicaid expansion in Kentucky is completely up to HHS,” Stamper wrote.

State officials haven’t officially applied for the waiver, but say they will on Aug. 1.


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