Friday, January 27, 2023

Welcome, everyone, to the third installment of the IMA Legislative report. The week has been dominated by a familiar issue; Medicaid Expansion.

Medicaid Expansion Update


In 2018, Idaho voters approved Medicaid Expansion through a ballot initiative. Upon adoption, there was a statutory requirement that the program be reviewed after five years. On Monday, Idaho Division of Medicaid administrator Juliet Charron jointly addressed the House and Senate Health and Welfare Committees to provide that review and status report.


For over an hour, Charron discussed and answered questions regarding utilization, impacts, containment, and what Idaho would look like without Medicaid Expansion. As many of you are aware, Medicaid is a very complex issue with a storied past. The presentation by the Department was educational, which no doubt was of use to freshmen legislators. Nearly half of the 20 combined committee members are new to the Idaho Legislature, with nine being elected in 2022.

Rising Costs

For FY24, the Department is requesting $67 million for Medicaid Expansion, which is an increased ask compared to last year's budget request.


A significant part of the questions from Legislators focused on the rising cost of expansion, which Ms. Charron explained was due to several contributing factors, including rapid state growth and utilization of services, continued inflation, and a pandemic. 


Medicaid Expansion began taking effect in January 2020.  During the program's infancy, the Families First Coronavirus Response Act required all Medicaid programs to maintain enrollment throughout the public health emergency. This federal requirement has resulted in approximately 67,000 ineligible Medicaid Expansion participants in Idaho. The redetermination of eligibility effort by the Department, which will take place over the next six months, may result in a decrease in program participants. However, the figures are mere estimates currently.


Despite the rise in costs, the Department informed Legislators that if the State were to remove itself from Medicaid Expansion, the Department estimates that it would actually cost the state more - approximately $77 million. This has to do with a number of factors, including the state's increasing spending on behavioral health crisis centers and the current 90-10 payment split with the federal government. 



Cost Containment

Realizing that costs were increasing, the Department of Health and Welfare proactively took action to contain them. The Department explained how it had been focused on preventative care by connecting new enrollees with a primary care physician and engaging with a third-party consultant. Through the Division of Financial Management, a third-party consultant was hired to review the program with the end goal of finding additional cost containment strategies. An interim report has been released to the Department, and those findings are currently under review. A full report is scheduled to be released sometime in April of this year and could contain recommendations for provider reimbursement cuts.

What's Next?

For the Legislature, the Chairs for the House, Rep. John Vander Woude (R-Nampa), and Senate, Sen. Julie VanOrden (R-Pingree), will work with their members to draft a letter of recommendation to the Idaho Legislature as to whether expansion should continue. This letter should arrive no later than January 31, 2023. The IMA Lobby Team will update you next week. 

 

Also, as mentioned above, the public health emergency ends on April 1, 2023, which means many current enrollees in the program will lose coverage. Beginning February 1, 2023, the Department of Health and Welfare will begin notifying those it believes no longer qualify for Medicaid Expansion. After 60 days from the time of notice, those who do not qualify will be removed. The Department expects to have completed the redeterminations by September 2023.

Plan for Independent Doctor Recruitment


Following Governor Little's State of the State, he highlighted a budget request for $3 million to assist independent physicians establishing medical clinics. The plan was recently presented to JFAC and would establish a partnership with IPAID, an independent physician organization, and attempt to incentivize doctors to start a practice or recruit doctors to Idaho. Below is a brief breakdown of the program:

 

1.    IPAID contributes 83.4% ($250,000) per independent doctor.

  • $50,000 line of credit, repaid over three years.
  • $200,000 salary guarantee first year, repaid over three years.

 

2.    The State contributes 13.6% ($50,000) per independent doctor.

  • $50,000 student loan payment in the form of a forgivable loan.
  • Forgiven after three years of independent practice in Idaho.

 

3.    Funding self-perpetuates over time.

  • One-time general fund allocation.
  • Repaid loans plus interest fund program in perpetuity.

 

JFAC will consider the budget request, with the final versions being presented towards the first part of March. The IMA Board of Trustees previously reviewed this proposal and voted in support of its establishment.

 

Throughout the Legislative Session, IMA monitors legislation and provides status updates every Friday. Click here to view the IMA Bill Tracker.

If you ever have any questions or need any advice, don't hesitate to touch base with us.


Mike Cunnington, Director of Government Affairs

(208) 344-7888

cunnington@idmed.org

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