“Sabotage.” “What are you saying? Did you say sandwich?”

I started at the League right before the holidays in 2016. In those early days, when people asked me about the status of the Affordable Care Act (ACA), I joked that I thought the ACA would be repealed before I figured out how to use the office microwave. (They even had some time because we had to replace the office microwave a few months ago.)

As we head into fall and I approach my one-year workaversary, the ACA is still here. But while it hasn’t been repealed, it is important that we not ignore the blatant sabotage being done to the ACA and our entire healthcare system.

Let’s take a look at just a few of the things that have been done:

  • On September 30, the Children’s Health Insurance Program (CHIP) expired. CHIP provides health insurance to nearly 120,000 Michigan children, and without reauthorization states are forced to pick up the costs or cut off enrollment to the program. The U.S. Senate had agreed to a bipartisan deal before the last ditch effort to repeal and replace the ACA. The House is expected to vote on a bill this week that contains many of the important pieces of the Senate bipartisan deal to extend CHIP but has some concerning provisions intended to produce savings in Medicare and Medicaid. The bill also includes funding to support Puerto Rico and the U.S. Virgin Islands that falls significantly short of the support families need following Hurricane Irma and Hurricane Maria.
  • The Trump administration has announced that they will allow employers to opt out of covering contraception for women based on moral or religious objection. This could affect nearly 1.9 million Michigan women.
  • The administration also announced a decision to end health insurance subsidies, known as cost-sharing reductions, that help low-income and middle-income customers pay out-of-pocket healthcare costs. This will only serve to add to the federal deficit and result in increased premiums. States have already announced decisions to increase premiums as a direct result of these payments being cut off
  • President Trump issued an executive order that calls on federal agencies to consider actions to create a “noncompliant” market that could mean plans that are exempt from ACA rules including pre-existing condition protections and essential health benefits. We will not know the full impact of this order until agencies go through the rulemaking process.
  • The Trump administration significantly cut funding for organizations charged with enrolling people into the ACA along with cutting funding to advertise and promote the open enrollment period.
  • The administration also shortened the enrollment period for people to sign up for health insurance and announced that the website to do so will be down for “maintenance” for 12 hours on Sundays during open enrollment.
Doug Mills - The New York Times

Doug Mills – The New York Times

While the Trump administration continues to find ways to undermine the ACA, there is some good news. Recently, Sens. Lamar Alexander (R-Tennessee) and Patty Murray (D-Washington) announced a bipartisan agreement to stabilize the insurance market. The plan includes continued funding of cost-sharing reductions, restoring portions of cuts to ACA outreach and enrollment, expanding eligibility for “catastrophic plans,” and making changes to waivers that allow states to modify certain provisions of the ACA.

This proposed plan is a starting point and absolutely not perfect; however, in order to ease some of the uneasiness around the ACA and insurance markets, it must be enacted. This is something that remains to be seen, and if the plan does receive action, what—if any—additional reforms or funding might also be included?

As we’ve seen for many years, and especially evident during the first 10 months of the Trump administration, is that healthcare is still highly political. It really is something lawmakers cannot seem to move past. Whether it is the showy legislative attempts to repeal the progress made with the ACA, the less publicized expiration of CHIP or the harmful attacks on the upcoming open enrollment—we promise to make sure you know about it.

BONUS: If you were wondering about the title of my blog, it’s from one of my favorite episodes of The Office—BEACH GAMES!

— Emily Schwarzkopf, Policy Analyst

Protect healthcare for 650,000 Michiganians

pdficonApril 2017
Emily Schwarzkopf, Policy Analyst

Continuation of the Affordable Care Act (ACA) and the Healthy Michigan Plan are critical for Michigan residents and the state’s economy. In recognition of the program’s success, the governor recommended, and the League supports, sufficient funding for the Healthy Michigan Plan in the 2018 budget year.

Budget Brief JPG USE THIS ONE

Sixty percent of Healthy Michigan enrollees report that their ability to access primary care was better than prior to being enrolled, and 70% stated that they were more likely to contact a primary care provider before going to the emergency room. Eighty-six percent of enrollees have reported that their ability to pay their medical bills has improved since being enrolled in the program.

The program has also made a significant impact on Michigan’s economy. The Healthy Michigan Plan has resulted in 30,000 jobs annually, $2.3 billion in additional personal spending power, and $150 million in state tax revenue as a result of added economic activity. Further, 90% of hospitals report reductions in uncompensated care, with overall uncompensated care dropping by nearly 50% across the state.

BACKGROUND ON MEDICAID EXPANSION

When it was first passed, the ACA included a requirement that states expand Medicaid to those with family incomes at or below 133% of the federal poverty level. The existing Medicaid program generally had only covered the aged, blind and disabled up to 100% of poverty, with higher income levels for certain populations (children and pregnant women) and lower for others (childless adults).

However, the June 2012 United States Supreme Court decision questioning the constitutionality of the ACA (National Federation of Independent Business v. Sebelius) found the provision to require states to expand Medicaid unconstitutional. As a result, states were given the option to expand their Medicaid programs without penalty. State programs would be covered 100% by federal funding through calendar year 2016. The federal match rate will phase down to 90% over the next five calendar years: to 95% in 2017, 94% in 2018, 93% in 2019 and 90% in 2020 and all subsequent years.

BB Protect healtcare for 650,000 Michiganians chart 1The Healthy Michigan program has been shown to be incredibly successful for those receiving coverage through the plan. The benefits for Healthy Michigan enrollees must be based on federal benchmark coverage and include the 10 essential healthcare services. The plan also covers dental and vision services, hearing aids and nonemergency medical transportation.

MICHIGAN’S FEDERAL WAIVERS

The legislation that created the Healthy Michigan program required Michigan to get two waivers from the federal government. The first waiver allowed the state to include cost-sharing requirements (including copays) and the use of health savings accounts into which newly-eligible enrollees would contribute. The contributions of enrollees could be reduced if certain healthy behaviors are addressed.

The second waiver limited the amount of time an enrollee could be enrolled in the Healthy Michigan Plan to 48 months. Once the 48-month cap is reached, an individual would have the opportunity to remain on Medicaid with higher cost-sharing requirements or purchase private insurance through the healthcare exchange and be considered eligible for premium tax credits. Both of these waivers were approved by the federal government.

Another important component of Michigan’s legislation is that should annual state savings and other nonfederal savings associated with the implementation of the program not be sufficient to cover the reduced federal match, the Healthy Michigan program would end. The state realizes savings from programs that were previously funded either partially or entirely by the state General Fund that are now covered in Healthy Michigan, including non-Medicaid mental health funding, Adult Benefits Waiver program, prisoner healthcare costs and Plan First! Waiver program costs. Savings can also be seen as a result of revenue from the Health Insurance Claims Assessment, the use tax on Medicaid managed care organizations, provider assessments and an established hospital quality assurance assessment program retainer on special hospital payments.

CONTINUED THREATS

Despite the recent defeat of the federal American Health Care Act, there is still the possibility that Congress will fundamentally change the way Medicaid funding is allocated and limit how long Medicaid expansion will continue. As Congress moves forward on other priorities, including tax reform, there is the possibility that Congress, in order pay for tax breaks, could shift the costs of the Medicaid program to the states through block grants or per capita caps. There also is a chance that Congress could make changes in Medicaid financing in the forthcoming federal budget or when the Children’s Health Insurance Plan (CHIP) funding is reauthorized in late summer or early fall. While the League encourages the Michigan Legislature to continue funding for the Healthy Michigan Plan in 2018 and beyond, it is also important to stay vigilant in protecting Medicaid funding and the Affordable Care Act.

THE GOVERNOR’S 2018 BUDGET RECOMMENDATION

The governor’s executive budget proposal includes continued funding for this critical program. Since the state is required to pay a share of the costs, the governor has recommended total funding of $4.1 billion, including a $200.4 million investment of state General Funds to cover the costs of the state’s match contribution. This amount does not take into account additional savings from revenue impacts or other budgetary savings created as result of the implementation of the Healthy Michigan Plan.