Thursday, April 24, 2014

Kitzhaber, Touting Medicaid Reforms, Says Oregon Plans To Do ACA Expansion

Posted: September 24, 2012

Oregon Gov. John Kitzhaber (D) told Inside Health Policy that Oregon plans to expand its Medicaid program as allowed by the health reform law, as many other states continue to mull their options and await answers to key questions from CMS on the now-voluntary expansion before deciding how to proceed. When asked whether Oregon's latest Medicaid waiver assumed that the state would fully expand its program to 133 percent of the federal poverty level, Kitzhaber said that although the ACA expansion is now optional, "We plan to do it."

Oregon and HHS reached an agreement in principle in May to let Oregon pursue a five-year Medicaid reform demonstration but the demonstration approval period began in July, after the Supreme Court ruled that ACA's Medicaid expansion was essentially optional for states because the federal government could not withhold all of a state's Medicaid funding for not expanding its program.

Oregon Health Authority spokeswoman Patty Wentz says the state is still analyzing the cost of the expansion to the state and the return on investment over the next 10 years, and that work "will be finalized over the next few months."

"The governor has been and remains committed to expanding health care coverage to as many Oregonians as possible and will be collaborating with the state legislature over the next steps," she said. A full expansion of Medicaid in Oregon would add between 180,000 and 220,000 people to its rolls.

Several states that support the health reform law have said they will expand Medicaid, but many states have signaled they will sit on the fence until after the election. Additionally, states and other stakeholders are awaiting an answer from CMS on whether states can do a partial expansion of Medicaid instead of expanding fully to 133 percent of the federal poverty level.

Although no official answer has been given, CMS Medicaid chief Cindy Mann recently suggested that CMS would not let states do a partial expansion. CMS has said that states do not have a deadline for when they must expand their programs, and if they do expand, they can decide to pull back on the expansion at any time.

Kitzhaber spoke last Tuesday (Sept. 18) at the Center for American Progress about Oregon's Medicaid reform efforts. Oregon, although it is headed by a Democratic governor and has moved quickly to implement major pieces of the ACA, has a divided legislature. In May, the state and HHS announced an agreement for a five-year demonstration waiver that lets Oregon create Coordinated Care Organizations to improve the way care is delivered to Medicaid beneficiaries.

Oregon will get $1.9 billion from the federal government over the five-year demonstration, and the state agreed to reduce the per capita medical cost trend in its Medicaid program by 2 percentage points by the end of the second year of the waiver.

Kitzhaber said Tuesday that the state essentially had been designing the Medicaid demonstration independent of the health reform law, and if the Supreme Court had thrown out the law the state still would have been able to proceed with it. But, because of the ACA's significant expansion of coverage in Medicaid and expanded small group market enrollment because of exchanges, the state was given a framework to move forward much more quickly with the demonstration, Kitzhaber said.

State officials say the demonstration will save $11 billion over the next decade. At the time that the waiver was announced (see related story), lawmakers touted the model as one that could serve as a prototype for national reform. The first set of Coordinated Care Organizations launched on Aug. 1 and several others began operating on Sept. 1. -- Rachana Dixit (This e-mail address is being protected from spambots. You need JavaScript enabled to view it )

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