Quo Vadis, Kentucky?

July 10th, 2018 by Tom Lynch

June 29, 2018. Thirteen days ago. I’m sitting in the Grand Ballroom of the Capital Hilton Hotel in Washington, DC, soaking in the presentations at the Annual Conference and CEO Summit of the Association for Community Affiliated Plans (ACAP). ACAP has grown to be quite the force for Medicare Advantage and Medicaid health plans around the country. So, the conference is an important event for Medicare and Medicaid professionals.

I’m looking forward to the 3:30 p.m. session, Plans Involvement in the New World of Work Requirements, because Mark Carter and Carl Felix, CEO and COO, respectively, of Kentucky’s Passport Health Plan, are going to describe their efforts to implement the Bluegrass State’s Medicaid work requirements.

In early January, 2018, Kentucky became the first state to win CMS approval to institute work requirements for its Medicaid beneficiaries. As I sit in the Hilton’s ballroom, its new  Medicaid work requirement program, Kentucky HEALTH, is slated to go live in two days (state government is only outdone by the US Army in its genius-like ability to create acronyms; this one stands for Helping to Engage and Achieve Long Term Health; catchy, eh?). There’s a pesky lawsuit lurking in the wings aimed at getting the Court to declare the program unconstitutional, but on June 29 Kentucky bureaucrats are ready to drop the hammer.

So, I am really interested in learning about the looming work requirement program, because three other states have won approval and are putting their programs together, and more are waiting in the wings.

Unfortunately, at the last minute, Mark and Carl (remember them?) have to cancel, because in the mad dash to the finish line for Kentucky HEALTH’s launch, they actually can’t leave the office. But, not to worry. Kentucky HEALTH’s Chief Marketing Officer is here to fill us in.

As she takes us through Kentucky HEALTH’s creation, I have to say that I, and the three or four hundred other people in the room are absolutely astonished at the time, money, manpower and all-around effort involved in giving birth to this behemoth. In terms of planning and implementation preparation, Kentucky HEALTH may perhaps only be exceeded by Operation Overlord (look it up). Some highlights:

  • For the first time EVER, Kentucky’s Medicaid beneficiaries will have to pay premiums. The premiums aren’t a lot (to you and me), ranging from $1 to $15 per month. Pregnant women and children are exempt.
  • Individuals with income above the poverty level ($12,060) who do not pay their premiums in 60 days will be kicked out of coverage for six months. Enrollees can return to the program earlier if they pay two months of missed premiums and make one new premium payment. They also must complete a financial or health literacy course.
  • Individuals must either work, volunteer, be enrolled in schooling or do some kind of “qualified community engagement” for at least 80 hours per month.
  • Beneficiaries must report their work activity each month; failure to do so will cause Medicaid disenrollment for six months.
  • Healthcare providers will have to certify to the Commonwealth the health status of those individuals they deem physically unable to work.

Regarding that last bullet – Kentucky HEALTH created a seven page form providers must complete. Knowing how busy healthcare providers are, I ask, “What’s been the feedback from your providers about this seven page form, and, by the way, are you paying them to do it?” Answer: “We haven’t communicated with the providers about this. We consider it all part of an office visit.”

For a moment, put aside why Kentucky is going to all this trouble. The bottom line question is: What does it get for going to all this trouble? In its need to get freeloaders off Medicaid rolls, just how many people would Kentucky’s work requirements actually put to work?

The nonprofit Kaiser Family Foundation provides some answers. Let’s check the numbers. Nationally:

  • About 10% of Medicaid recipients are elderly, age 65 and older, and many of them are in nursing homes.
  • About 48% are children, age 18 and younger.
  • That leaves about 42% who are of working age and potentially subject to the requirements.
  • Of that 42% who could be subject to the rules, 42% of them are already working full-time, and 18% are working part-time.
  • Another 14% are not working due to illness or disability.
  • Six percent are in school.
  • Twelve percent are caregivers for family members.
  • All of the above would be exempt from Kentucky’s rules.

That leaves about 1% of all Medicaid beneficiaries who would qualify for a work requirement program like Kentucky’s. That’s about 740,000 people nationally and around 12,000 in Kentucky (Since 2014, when Kentucky accepted Medicaid expansion, its Medicaid population has about doubled, rising from around 650,000 to 1.2 million) .

Kentucky HEALTH’s CMO wouldn’t (or couldn’t) say how much the state has spent on putting the program together or how many people have been devoted to it. But its best case scenario is that out of 1.2 million current beneficiaries about 95,000 may be off the rolls in five years, because either they no longer qualify for Medicaid because they either make too much money due to full-time work or they fail to comply with work requirements.

The day after the Kentucky HEALTH presentation at the ACAP conference District court Judge James Boasberg ruled Kentucky’s plan unlawful, because the federal government is obligated under federal law to consider whether a Medicaid proposal advances the program’s objectives, the judge wrote, and the Trump administration failed to meet that standard before approving Kentucky’s plan.

One final thought. When he announced the Trump administration’s approval of Kentucky’s work requirement plan, Governor Matt Bevin said, “I was raised by a father who said, ‘Don’t take something that is not earned.’” So, here’s the question: Unlike the entirety of the rest of the developed world, in America is basic health care something that has to be “earned?”

 

 

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