Idaho’s House has a Medicaid expansion modification bill under consideration. The big thing it wants is work requirements. It is unlikely to get that without an act of Congress given the litigation that went against work requirements for Medicaid during the Trump administration. However, it also wants to transfer a lot of funds to its state’s hospitals from the middle class via its Medicaid program:
The department has, with federal approval if necessary, allowed persons eligible for medicaid under this section who have a modified adjusted gross income at or above one hundred percent (100%) of the federal poverty level to receive the advance premium tax credit to purchase a qualified health plan through the Idaho health insurance exchange established by chapter 61, title 41, Idaho Code, instead of enrolling in Medicaid, except that a person may choose to enroll in Medicaid instead of receiving the advance premium tax credit to purchase a qualified health plan;
This is a modification of the Arkansas Private Option where Arkansas placed its Medicaid Expansion population into ACA exchange plans instead of traditional Medicaid under an Obama administration waiver. Arkansas enrollees are placed into the ACA unless they meet certain complex medical conditions.
However this is discretionary in Idaho as currently written. This optionality changes the dynamics. It is an invitation for a huge transfer to hospitals from the 138% federal poverty level and above ACA enrollees.
Hospitals get paid substantially more from an ACA enrollee than a Medicaid enrollee. CSR-94 plans, which is what these enrollees would be eligible for have some premium and cost sharing (~$500 deductibles is not uncommon) while Medicaid has token premiums and minimal cost-sharing. We know from Allen et al that ACA plans have substantially more spending mainly due to price levels than Medicaid expansion plans for individuals who barely qualify for one of the two programs. We know that most people have minimal spending and minimal interest in buying access to care.
I’m working on a project with several collaborators where we examine the impact of consolidation in the dialysis industry on ACA premiums. Duopolies in dialysis means substantially higher premiums for the ACA. A good chunk of the hypothesized mechanism is that dialysis firms are very happy to pay for the premiums and cost-sharing of an ACA enrollee who needs dialysis through a charitable foundation. They are happy to do this because ACA plans pay the dialysis center substantially more than Medicare or Medicaid so even net of paying the premium and cost-sharing, the dialysis firms come out WAY AHEAD!
I would be shocked if hospitals don’t send their social worker to every Medicaid Expansion patient who has cancer, hemophilia, or other very high cost disease with an offer for the patient to elect an ACA plan with hospital foundation grants to pay the premium and any additional cost-sharing. Doing this would be a massive windfall to the hospitals and it would mainly be paid for by either the federal government in the form of higher premium tax credits OR really sick individuals with incomes that are high enough to make them subsidy ineligible.
On The Road – frosty – 3rd Annual National Park/COVID Challenge Part 2 – Pinnacles National Park
Betty
Gee, I wonder who came up with this ingenious plan.
Anonymous At Work
By enrolling more patients to receive more/better care through ACA, would the extra preventive care/avoidance of emergency room care be price-neutral or close enough to be “meh”?
David Anderson
@Anonymous At Work: not even close
gene108
David, having been on dialysis, why would ACA plans be on the hook for dialysis treatment?
In center dialysis treatment gets covered by Medicare after three months from the start of dialysis. Wouldn’t the payments from ACA plans be insubstantial because it just bridges the three months until Medicare kicks in?
What exactly am I missing?
Edit: At home dialysis treatment gets covered by Medicare from the start of training to it yourself.
Ohio Mom
I really don’t have much focus this morning, I can tell by how long it took me to complete the puzzles in today’s paper. But I think I get the gist of this, it’s Another Example of a Red State Being a Taker.
Villago Delenda Est
The poor must be punished.
Anonymous At Work
@David Anderson: Kinda short-sighted for Arkansas and Idaho to load up ACA while electing representatives to sabotage it as a way to make the top line price for Medicaid expansion seem cheaper. Unless that is the political price for persuading the people’s representatives to help their people’s health.
(Having lived, worked, and routinely visited Arkansas, I can believe it.)
David Anderson
@gene108: Anyone who is on ESRD with sufficient time (1st day of the 4th month of dialysis (https://www.medicare.gov/basics/end-stage-renal-disease) is eligible for MEDICARE. Individuals do not automatically enroll in Medicare. They must elect it.
Since the passage of the ACA, the two big dialysis chains strongly encouraged the U-65 ESRD population to buy ACA plans. https://jamanetwork.com/journals/jama/article-abstract/2764171
These plans pay dialysis firms substantially more per unit of service than Medicare. Optionality in Idaho would create the same incentives for hospitals.
Jerry
David! This is an ACA-shaped bat signal for you. I’m about to sign up for a plan, but I have just a few questions. Is there a way that I can ask you those question?
Rufus T Firefly
Long-term lurker and appreciate the community. Also in Oly and something about Cole posting from AZ, where I dearly love to hike, and this post pushed me into the open. So, hi!
For-profit dialysis is an amazing study in good intentions gone badly awry. There are great policy and moral arguments for just plain making sure people who need it can get it – as there are for many conditions which were once a miserable death sentence and can now be clinically managed to give folks at least a decent and in many cases a good life, as long as someone pays for it. (Shout out to the Biden administration for $35 insulin!)
So dialysis made it into Medicare as the high-water mark of its expansion, when nobody expected it to become a common need. (The back-story on that is great, with dramatic dialyzation in a Congressional hearing room.) But Medicare provided the core funding for dialysis companies as government contractors providing standarized commodity services at cost-plus rates. With their nut guaranteed those contractors could use the dialysis centers they built backed by federal funding to seek profits from the private sector. The effects on ACA plans are impressive; the profit-seeking from employment-based plans even more so.
Nobody would build a system like American healthcare financing on purpose. It’s Darwin’s tangled bank on steroids.
gene108
@David Anderson:
From the end of the discussion section in the JAMA link:
When I was on dialysis, I kept private insurance and Medicare. Initially kept my employer insurance and then switched to an ACA plan, along with being enrolled in Parts A & B.
Whether Medicare is a primary or secondary payer, I think, would be influenced by this mix. I’m not sure how many patients have both Medicare and private insurance, since I’m only using my own experience in this.
It could explain some of the changes in payment mix rather than an either or situation.