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Government, Politics & Issues

Federal health-care reform may increase the number of Missourians on Medicaid

This article first appeared in the St. Louis Beacon, Aug. 3, 2009 - The U.S. House Energy and Commerce Committee's approval Friday of a bill overhauling the nation's health-care system reinforced the hopes and fears of Missouri's political players on both sides of the debate.

The action also highlights the differences between states like Missouri, which have low eligibility limits for low-income people seeking health-care assistance, and more generous states like Illinois.

The bill approved by the U.S. House's Energy and Commerce Committee would do more than expand the number of people eligible for health-care coverage.

The committee's state-by-state analysis (broken down by congressional district) also lays out its predicted impact on small businesses, the elderly, health-care providers and families facing bankrupty because of high health-care bills.

Again, activists on both sides caution that other House and Senate panels are looking at different proposals that would have varying effects on the same people. But since the Energy and Commerce plan was the first to be voted out, all sides are looking closely at its numbers.

For Missouri, the bill's crafters say it would affect:

-- up to 135,900 small businesses that could qualify for tax credits to help pay for health-care coverage for their workers;

-- 96,400 Missourians age 65 and over who are penalized because their prescription drug costs are high enough to force them into the federal "doughnut hole'' where they temporarily lose their Medicare drug coverage, known as Part D.

-- an average of 11,910 Missourians a year who file for bankruptcy because of high medical bills.

-- Health-care providers who would be paid $1.55 billion more a year that they now lose in uncompensated care to people who can't afford to pay.

In Illinois, the committee is estimating that 1.484 million uninsured residents would be able to get health coverage.  In addition:

--- 281,600 small businesses would qualify for tax credits to help pay for employee coverage.

-- 148,000 elderly now penalized by Medicare's Part D "doughnut hole'' would no longer be affected, as a result of the changes

-- An annual average of 33,850 families would avoid bankruptcy because of medical expenses

-- $1.947 billion would be paid to health-care providers who now lose that amount in uncompensated care.

Other House and Senate panels are considering other plans for revamping the nation's health-care system, but some on both sides in Missouri say the Energy and Commerce Committee's bill offers some hint of the general direction Congress is likely to take.

Although not all the details are yet available, the preliminary information released by the committee indicates that its proposal would force Missouri to expand its Medicaid rolls by raising its eligibility limit, now one of the nation's lowest.

According to the congressional committee's estimates, its proposed health-care changes would expand coverage to 712,000 Missourians who are now uninsured. Not all are low income; some are people without coverage because of various reasons, such as insurers' refusal to provide coverage because of pre-existing medical conditions.

(In Illinois, it's estimated that 1.484 million uninsured residents would be able to get health coverage.)

But supporters and critics of the Democratic-driven effort say it's a given that some would be low-income people who now don't qualify for Medicaid coverage in Missouri because of its strict income limits. That view was voiced by both sides during recent raucous health-care forums in St. Louis.

At least 90,000 low-income Missourians lost their Medicaid coverage in 2005, and about 200,000 others saw their coverage reduced, when Republicans controlling state government lowered the state's Medicaid eligibility limits and reduced benefits out of concern that the program's rapidly expanding rolls were costing the state more than it could afford.

Although Missouri's income restrictions vary depending on the type of Medicaid program, most limit low-income parents to earning no more than 20 percent of the national poverty level. That restriction amounts to income limits of $2,200 to $3,504 a year, depending on the Medicaid program (offically called MoHealthNet). Missouri's eligible income limit is higher for the permanently disabled, blind or those over 65.

Most of the congressional measures that would revamp the nation's health-care system call for requiring the states to offer Medicaid coverage to people earning far more -- up to 133 percent of poverty level, or roughly $14,400 a year.

That requirement would have less impact in Illinois, where the income limits for Medicaid coverage now range from 133 percent to 200 percent of the federal poverty level, according to the nonpartisan Kaiser Family Foundation, which tracks health care spending for all 50 states. (As in Missouri, Illinois' income limit is higher for qualifying children than for their parents.)

The upshot: The Medicaid income limit for a working parent in Illinois now can be more than nine times higher than the limit for a qualifying parent in Missouri.

Missouri state Rep. Allen Icet, R-Wildwood and chairman of the House Budget Committee, says that he's been concerned for some time that federal officials or Congress might step in and mandate that Missouri expand its Medicaid rolls, even though Icet and his allies maintain that the state cannot afford to do so.

Icet, who is now running for Missouri state auditor, said in an interview after his kickoff speech last Thursday that Missouri's stricter Medicaid limits are among the reasons it is faring better during the current economic downturn than Illinois, where state officials are being forced to trim more than $1 billion from that state's budget.

Icet added that his concern about more federal mandates was among the reasons his speech included accusations that the Obama administration appeared to be violating the Constitution's protections on states rights.

But some of his GOP counterparts in the Missouri Senate have been predicting for months that Congress' likely changes in the nation's health care would force Missouri to expand its Medicaid rolls.

State Senate President Pro Tem Charlie Shields, R-St. Joseph, was among the senators who made that argument when they successfully persuaded the state Senate last May to overwhelmingly support the plan crafted by Gov. Jay Nixon, a Democrat, and the Missouri Hospital Association. It called for the hospitals to pay higher fees to the state that would be used to access more federal Medicaid matching funds to cover low-income working parents.

The plan would not have cost the state any additional taxpayer dollars, but would have had the effect of covering working Missouri parents who earned up to 50 percent of the federal poverty -- or roughly $8,800 a year for a family of three.

The proposal died in the state House, where Icet and other Republican leaders opposed it because they feared the state would be saddled with the extra costs in future years.

Shields said in a recent interview that he still believes that any new federal health-care program will force Missouri to increase its eligibility limits for Medicaid. He added that after last spring's rebuff in the state House, Missouri hospitals may not renew their offer to pay more money to the state -- in the end forcing the state to come up with the added cash for its share of a Medicaid expansion.

Nixon has been circumspect on the issue, saying in an interview a few weeks ago that he was withholding comment until he saw what sort of changes were approved by Congress.

But Amy Blouin, executive director of the Missouri Budget Project, says she and the non-profit agency -- which advocates more access to health care -- would be happy to see Missouri required to expand its Medicaid rolls.

Blouin was among the area health-care advocates closely watching Friday's vote by the U.S. House's Energy and Commerce Committee.

Most of the various health-care plans considered in the U.S. House and Senate call for some sort of federal financial help to help Missouri and other states cover the cost of expanding their Medicaid rolls, Blouin said. Some proposals offer federal help for just a few years, while others make the federal spending permanent.

A key benefit, Blouin said, would be to "make Medicaid policy more uniform between the states."

The upshot for the region: an end to the huge Medicaid coverage disparity between Missouri and Illinois.

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