T O E HE PTIONAL XPANSION OF M W : EDICAID IN YOMING COSTS, OFFSETS, AND CONSIDERATIONS FOR DECISION-MAKERS THOMAS O. FORSLUND, DIRECTOR NOVEMBER 2012 SECTION I: INTRODUCTION Elected officials in Wyoming have a choice to make regarding whether or not to expand Wyoming Medicaid to low income adults. They can either choose to expand Medicaid when the enhanced federal funding begins in 2014, or they can choose to wait to make a decision regarding expansion, or they can choose not to expand the program at all. To support Wyoming elected officials in this decision, the Wyoming Department of Health conducted an analysis of the information currently available regarding the costs and benefits of the ACA and its impact on Medicaid. The conclusion of this analysis is that the optional Medicaid expansion provides a cost-effective route to increase the number of people insured in Wyoming. In fact, due to numerous offsets that would be made available by the optional expansion, the expansion of the Medicaid program would result in Wyoming general fund cost savings across the first 6 years of the ACA implementation (FY 2014-2020). In the following pages, the Wyoming Department of Health presents its analysis. Section II of this report provides background information on the ACA provisions to expand health care coverage. Section III describes the uninsured population in Wyoming. Section IV describes, in detail, the choice whether to expand or to not. Section V sets out the costs related to expanding Medicaid, while Section VI discusses the potential offsets. In Section VII, the costs and potential offsets are combined to show the potential savings associated with expansion. 1 SECTION II: THE AFFORDABLE CARE ACT In March of 2010, Congress passed the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (ACA). Immediately after the ACA was passed, litigation ensued over the constitutionality of the law. The Lawsuit While several actions were heard by lower courts, ultimately, the United States Supreme Court agreed to hear a combination of actions resulting in four main areas of contention. 1) Does the Anti-Injunction Act bar the action from being heard by the court; 2) Is the individual mandate constitutional; 3) If the individual mandate is not constitutional, can it be severed from the rest of (cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:70)(cid:87)(cid:30)(cid:3)(cid:23)(cid:12)(cid:3)(cid:3)(cid:39)(cid:82)(cid:72)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:38)(cid:36)(cid:182)(cid:86)(cid:3)(cid:48)(cid:72)(cid:71)(cid:76)(cid:70)(cid:68)(cid:76)(cid:71)(cid:3)(cid:72)(cid:91)(cid:83)(cid:68)(cid:81)(cid:86)(cid:76)(cid:82)(cid:81)(cid:3)(cid:85)(cid:72)(cid:84)(cid:88)(cid:76)(cid:85)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:72)(cid:91)(cid:70)(cid:72)(cid:72)(cid:71)(cid:3)(cid:38)(cid:82)(cid:81)(cid:74)(cid:85)(cid:72)(cid:86)(cid:86)(cid:182)(cid:86)(cid:3)(cid:68)(cid:88)(cid:87)(cid:75)(cid:82)(cid:85)(cid:76)(cid:87)(cid:92)(cid:3)(cid:88)(cid:81)(cid:71)(cid:72)(cid:85)(cid:3) the Spending Clause? The U.S. Supreme Court issued its ruling in the National Federation of Independent Business et al. v. Sebelius, Secretary of Health and Human Services et. al, on June 28, 2012. While the (cid:38)(cid:82)(cid:88)(cid:85)(cid:87)(cid:3)(cid:88)(cid:83)(cid:75)(cid:72)(cid:79)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:76)(cid:81)(cid:71)(cid:76)(cid:89)(cid:76)(cid:71)(cid:88)(cid:68)(cid:79)(cid:3)(cid:80)(cid:68)(cid:81)(cid:71)(cid:68)(cid:87)(cid:72)(cid:3)(cid:68)(cid:86)(cid:3)(cid:68)(cid:3)(cid:70)(cid:82)(cid:81)(cid:86)(cid:87)(cid:76)(cid:87)(cid:88)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79)(cid:3)(cid:72)(cid:91)(cid:72)(cid:85)(cid:70)(cid:76)(cid:86)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:38)(cid:82)(cid:81)(cid:74)(cid:85)(cid:72)(cid:86)(cid:86)(cid:182)(cid:86)(cid:3)(cid:68)(cid:88)(cid:87)(cid:75)(cid:82)(cid:85)(cid:76)(cid:87)(cid:92)(cid:3)(cid:87)(cid:82)(cid:3)(cid:87)(cid:68)(cid:91)(cid:15)(cid:3)(cid:76)(cid:87)(cid:3) struck down t(cid:75)(cid:72)(cid:3)(cid:36)(cid:38)(cid:36)(cid:182)(cid:86)(cid:3)(cid:85)(cid:72)(cid:84)(cid:88)(cid:76)(cid:85)(cid:72)(cid:80)(cid:72)(cid:81)(cid:87)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:86)(cid:87)(cid:68)(cid:87)(cid:72)(cid:86)(cid:3)(cid:72)(cid:91)(cid:83)(cid:68)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:76)(cid:85)(cid:3)(cid:48)(cid:72)(cid:71)(cid:76)(cid:70)(cid:68)(cid:76)(cid:71)(cid:3)(cid:83)(cid:85)(cid:82)(cid:74)(cid:85)(cid:68)(cid:80)(cid:86)(cid:17)(cid:3)(cid:3) Impact of the Supreme Court Decision on Medicaid Specifically, the Court ruled unconstitutional the penalty set out by the ACA that could be imposed upon states that did not expand their Me(cid:71)(cid:76)(cid:70)(cid:68)(cid:76)(cid:71)(cid:3) (cid:83)(cid:85)(cid:82)(cid:74)(cid:85)(cid:68)(cid:80)(cid:86)(cid:17)(cid:3) (cid:3) (cid:55)(cid:75)(cid:72)(cid:3) (cid:54)(cid:88)(cid:83)(cid:85)(cid:72)(cid:80)(cid:72)(cid:3) (cid:38)(cid:82)(cid:88)(cid:85)(cid:87)(cid:182)(cid:86)(cid:3) decision prevents the U.S. Department of Health and Human Services (HHS) Secretary from penalizing states that choose not to expand their Medicaid programs by revoking or withholding existing Medicaid funding. This decision has been interpreted to make the ACA Medicaid expansion to low-income adults optional. (cid:55)(cid:75)(cid:72)(cid:3)(cid:75)(cid:76)(cid:74)(cid:75)(cid:3)(cid:70)(cid:82)(cid:88)(cid:85)(cid:87)(cid:182)(cid:86)(cid:3)(cid:85)(cid:88)(cid:79)(cid:76)(cid:81)(cid:74)(cid:3)(cid:68)(cid:79)(cid:79)(cid:82)(cid:90)(cid:86)(cid:3)(cid:86)(cid:87)(cid:68)(cid:87)(cid:72)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:80)(cid:68)(cid:78)(cid:72)(cid:3)(cid:87)(cid:75)(cid:72)(cid:76)(cid:85)(cid:3)(cid:82)(cid:90)(cid:81)(cid:3)(cid:71)(cid:72)(cid:70)(cid:76)(cid:86)(cid:76)(cid:82)(cid:81)(cid:3)(cid:68)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:90)(cid:75)(cid:72)(cid:87)(cid:75)(cid:72)(cid:85)(cid:3)(cid:82)(cid:85)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:87)(cid:82)(cid:3)(cid:72)(cid:91)(cid:83)(cid:68)(cid:81)(cid:71)(cid:3) their Medicaid programs to cover optional low income adults up to 138% of the Federal Poverty Level (FPL). The U.S. Department of Health and Human Services (HHS) has made clear that the while the U.S. Supreme Court opinion makes optional the expansion of Medicaid to non- Medicare eligible adults, other requirements including coverage for the woodwork population and newly eligible children are mandatory.1                                                                                                                       1 Secretary of Health and Human Services Letter to Governors, Kathleen Sebelius, July 10, 2012, http://capsules.kaiserhealthnews.org/wp-content/uploads/2012/07/Secretary-Sebelius-Letter-to-the-Governors- 071012.pdf More specifics are available from Kaiser Commission on Medicaid and the Uninsured: How Will the Medicaid Expansion for Adults Impact Eligibility and Coverage? Publication Number 8338, 07-25-2012, Found at http://www.kff.org/medicaid/8338.cfm 2 Four Main Parts Of The ACA Related to the Uninsured (cid:50)(cid:81)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:38)(cid:36)(cid:182)(cid:86)(cid:3)(cid:80)(cid:68)(cid:76)(cid:81)(cid:3)goals was to expand access to health insurance coverage. It set out to achieve this goal in four ways: 1) Individual mandate; 2) Employer participation/penalties; 3) Health Benefit Exchanges with federal subsidies for the purchase of insurance; and 4) Expansion of Medicaid. Each of these four parts plays a role in reducing the rate of uninsured. The Individual Mandate Beginning in 2014, almost all U.S. citizens will be required to have or obtain qualifying health insurance coverage. Individuals (U.S. citizens and legal residents) who do not have qualifying health insurance coverage could be assessed a tax penalty. The tax will be phased in over a number of years.2 Imbedded in the individual mandate are a number of exemptions allowing numerous groups of individuals to be spared this tax penalty. These exemptions include: financial hardship, religious objections, American Indians, those without coverage for less than three months, undocumented immigrants (who are not eligible for health insurance subsidies under the ACA), incarcerated individuals, those for whom coverage is deemed unaffordable (the lowest cost plan option (cid:72)(cid:91)(cid:70)(cid:72)(cid:72)(cid:71)(cid:86)(cid:3)(cid:27)(cid:8)(cid:3)(cid:82)(cid:73)(cid:3)(cid:68)(cid:81)(cid:3)(cid:76)(cid:81)(cid:71)(cid:76)(cid:89)(cid:76)(cid:71)(cid:88)(cid:68)(cid:79)(cid:182)(cid:86)(cid:3)(cid:76)(cid:81)(cid:70)(cid:82)(cid:80)(cid:72)(cid:12)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:82)(cid:86)(cid:72)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:76)(cid:81)(cid:70)(cid:82)(cid:80)(cid:72)(cid:86)(cid:3)(cid:69)(cid:72)(cid:79)(cid:82)(cid:90)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:87)(cid:68)(cid:91)(cid:3)(cid:73)(cid:76)(cid:79)(cid:76)(cid:81)(cid:74)(cid:3)(cid:87)(cid:75)(cid:85)(cid:72)(cid:86)(cid:75)(cid:82)(cid:79)(cid:71)(cid:17)3 Individuals not exempted from the individual mandate could be eligible for a federal subsidy to assist with purchasing health insurance. Employer Participation/Penalties The ACA requires employers with 50 or more full-time workers to offer qualifying health insurance coverage. Fees may be assessed to employers if any of their employees receive a federal premium subsidy through the Health Benefit Exchange.4 Employer participation is required beginning in 2014. Small business employers (those with less than 50 full-time workers) are exempt from the employer participation requirement and do not have to provide health insurance coverage to their employees. The Health Benefits Exchange Individuals without employer-sponsored coverage who are ineligible for Medicaid or Medicare may purchase insurance through a Health Benefit Exchange (Exchange). An exchange is an organized marketplace where consumers can purchase private insurance coverage. Health Benefit Exchanges can be operated in one of four ways: by the state itself; by a non-profit organization; by the federal government; or, as a hybrid that is operated jointly by a state and the                                                                                                                       2 (cid:179)(cid:55)(cid:75)(cid:72)(cid:3)(cid:83)(cid:72)(cid:81)(cid:68)(cid:79)(cid:87)(cid:92)(cid:3)(cid:90)(cid:76)(cid:79)(cid:79)(cid:3)(cid:69)(cid:72)(cid:3)(cid:83)(cid:75)(cid:68)(cid:86)(cid:72)(cid:71)-in according to the following schedule: $95 in 2014, $325 in 2015, and $695 in 2016 or the flat fee of 1.0% of taxable income in 2014, 2.0% of taxable income in 2015, and 2.5% of taxable income in 2016. Beginning after 2016, the penalty will be increased annually by the cost-of-living ad(cid:77)(cid:88)(cid:86)(cid:87)(cid:80)(cid:72)(cid:81)(cid:87)(cid:17)(cid:180)(cid:3)(cid:54)(cid:72)(cid:72)(cid:3) http://www.kff.org/healthreform/upload/8061.pdf 3 See http://www.kff.org/healthreform/upload/8061.pdf 4 Employers that do not offer coverage and have one full-time employee who receives a premium subsidy may be assessed a fee of $2,000 per full-time employee, excluding the first 30 employees from the assessment. Employers that do offer coverage, but still have one full-time worker who receives a federal premium subsidy, may be assessed a fee of the lesser of $3,000 for each employee receiving a premium credit or $2,000 for each full-time employee, excluding the first 30 employees from the assessment. See http://www.kff.org/healthreform/upload/8061.pdf 3 federal government. Each state has the option to choose who will operate their exchange. If a state does not make a choice, the decision defaults to the federal government. Federal subsidies will be available only through the Exchange to individuals and families with incomes between 100% FPL and 400% FPL. The federal subsidies are available in the form of premium credits and cost-sharing credits. Premium credits will assist individuals in purchasing private insurance using a sliding scale so that a(cid:81)(cid:3)(cid:76)(cid:81)(cid:71)(cid:76)(cid:89)(cid:76)(cid:71)(cid:88)(cid:68)(cid:79)(cid:3)(cid:82)(cid:85)(cid:3)(cid:73)(cid:68)(cid:80)(cid:76)(cid:79)(cid:92)(cid:182)(cid:86)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:85)(cid:76)(cid:69)(cid:88)(cid:87)(cid:76)(cid:82)(cid:81)(cid:86)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:79)(cid:76)(cid:80)(cid:76)(cid:87)(cid:72)(cid:71)(cid:3) to a specific percentage of their income.5 Cost-sharing subsidies will also be available through the ACA to offset the costs of co-pays and deductibles. The cost-sharing subsidies will be tax credits that result in a reduction of total cost sharing for the individual. Expansion of Medicaid (cid:55)(cid:75)(cid:72)(cid:3)(cid:73)(cid:76)(cid:81)(cid:68)(cid:79)(cid:3)(cid:83)(cid:76)(cid:72)(cid:70)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:38)(cid:36)(cid:182)(cid:86)(cid:3)(cid:83)(cid:79)(cid:68)(cid:81)(cid:3)(cid:87)(cid:82)(cid:3)(cid:72)(cid:91)(cid:87)(cid:72)(cid:81)(cid:71)(cid:3)(cid:75)(cid:72)(cid:68)(cid:79)(cid:87)(cid:75)(cid:3)(cid:70)(cid:68)(cid:85)(cid:72)(cid:3)(cid:70)(cid:82)(cid:89)(cid:72)(cid:85)(cid:68)(cid:74)(cid:72)(cid:3)(cid:76)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:48)(cid:72)(cid:71)(cid:76)(cid:70)(cid:68)(cid:76)(cid:71)(cid:3)(cid:72)(cid:91)(cid:83)(cid:68)(cid:81)(cid:86)(cid:76)(cid:82)(cid:81)(cid:17)(cid:3) Certain provisions of the ACA required coverage of certain mandatory populations such as children were unchanged by the Supreme Court decision. Other provisions related to extending coverage to adults were altered by the Supreme Court and made optional for states. Under the optional ACA Medicaid expansion, Medicaid coverage could be made available to all non-Medicare eligible adults under the age of 65 with incomes up to 138%6 of Federal Poverty Level (FPL) ($15,415 for an individual or $31,809 for a family of four in 2012).7 Figure 1 depicts the change in the basic eligibility structure (as measured by FPL) for those groups that would be impacted by the changes to the Medicaid program.                                                                                                                       5 The credits will be tied to the second lowest cost silver plan (in the Exchange). The premium contributions will be limited as follows: 100-133% FPL: 2% of income, 133-150% FPL: 3 (cid:177) 4% of income, 150-200% FPL: 4 (cid:177) 6.3% of income, 200-250% FPL: 6.3 (cid:177) 8.05% of income, 250-300% FPL: 8.05 (cid:177) 9.5% of income 300-400% FPL: 9.5% of income. See http://www.kff.org/healthreform/upload/8061.pdf 6 While the ACA specifically states 133% FPL, because the ACA also requires a 5% income disregard, the new standard for financial eligibility is commonly referred to as 138% FPL. 7 HHS 2012 Poverty Guidelines for 100% of poverty. See http://aspe.hhs.gov/poverty/12poverty.shtml In addition to making changes in who is eligible, the ACA also requires changes in determining eligibility. States must now implement Modified Adjusted Gross Income (MAGI) to determine eligibility. See http://www.medicaid.gov/AffordableCareAct/Provisions/Downloads/MedicaidCHIP-Eligibility-Final-Rule-Fact- Sheet-Final-3-16-12.pdf 4 Current If Wyoming elects to expand its Medicaid program, the Federal Government will cover 100% of the costs of newly eligible adults from 2014 through 2016. Beginning in 2017, the Federal share will be reduced to 95%, then to 94% in 2018, to 93% in 2019, and to 90% in 2020 and beyond. If the State chooses to forego the opportunity for Medicaid expansion, then residents of Wyoming with incomes 138% of FPL and below who are not currently eligible for Wyoming Medicaid, will not have access to Medicaid coverage. However, individuals and families whose income falls between 100% FPL and 138% FPL will be able to purchase health insurance through the Health Benefit Exchange with great assistance from federal subsidies (they would not pay more than 2% of income towards a premium). Individuals and families with incomes falling below 100% FPL will not be eligible for federal subsidies on the Health Benefit Exchange under the ACA. It is unlikely that this group could afford to purchase private coverage without assistance. The exclusion of those under 100% FPL from eligibility for federal subsidies could lead to a gap in coverage in states that choose not to expand their Medicaid programs. The uninsured truly in poverty will most likely remain uninsured. 5 SECTION III: WYOMING(cid:182)S UNINSURED As the State decides whether or not to expand Wyoming Medicaid, the uninsured in Wyoming should be con(cid:86)(cid:76)(cid:71)(cid:72)(cid:85)(cid:72)(cid:71)(cid:17)(cid:3)(cid:3)(cid:44)(cid:73)(cid:3)(cid:71)(cid:72)(cid:70)(cid:85)(cid:72)(cid:68)(cid:86)(cid:76)(cid:81)(cid:74)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:81)(cid:88)(cid:80)(cid:69)(cid:72)(cid:85)(cid:3)(cid:82)(cid:73)(cid:3)(cid:88)(cid:81)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3)(cid:76)(cid:86)(cid:3)(cid:68)(cid:3)(cid:74)(cid:82)(cid:68)(cid:79)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:71)(cid:72)(cid:70)(cid:76)(cid:86)(cid:76)(cid:82)(cid:81)- makers, then the expansion of Medicaid should be considered as a route to obtaining that goal. The ACA is expected to cause a decrease in the rate of uninsured in Wyoming. A recent actuarial study commissioned by the State of Wyoming estimates that the combination of the individual mandate, Health Benefit Exchanges, federal subsidies and Medicaid Expansion will decrease the uninsured population in Wyoming 50% by 2016.8 Wyom(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:56)(cid:81)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3) The challenges associated with uninsured citizens are relevant and timely issues for Wyoming policymakers. In the previously mentioned actuarial report, Current Population Survey (CPS) data was used to estimate that Wyoming had 83,000 uninsured residents in 2010. Additionally, (cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:88)(cid:81)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:68)(cid:83)(cid:83)(cid:72)(cid:68)(cid:85)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:69)(cid:72)(cid:3)(cid:76)(cid:81)(cid:70)(cid:85)(cid:72)(cid:68)(cid:86)(cid:76)(cid:81)(cid:74)(cid:17)(cid:3)(cid:3)(cid:55)(cid:75)(cid:72)(cid:3)(cid:73)(cid:76)(cid:74)(cid:88)(cid:85)(cid:72)(cid:3)(cid:69)(cid:72)(cid:79)(cid:82)(cid:90)(cid:3)(cid:86)(cid:75)(cid:82)(cid:90)(cid:86)(cid:3)an increase in (cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:88)(cid:81)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3)(cid:85)(cid:68)(cid:87)(cid:72)(cid:3)(cid:73)(cid:85)(cid:82)(cid:80)(cid:3)(cid:21)(cid:19)(cid:19)(cid:26)(cid:3)(cid:87)(cid:82)(cid:3)(cid:21)(cid:19)(cid:20)(cid:19)(cid:17) (cid:38)(cid:51)(cid:54)(cid:3)(cid:72)(cid:86)(cid:87)(cid:76)(cid:80)(cid:68)(cid:87)(cid:72)(cid:86)(cid:3)(cid:82)(cid:73)(cid:3)(cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:88)(cid:81)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3)(cid:83)(cid:82)(cid:83)(cid:88)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:15)(cid:3)(cid:69)(cid:92)(cid:3)(cid:76)(cid:81)(cid:70)(cid:82)(cid:80)(cid:72)(cid:15)(cid:3)(cid:86)(cid:75)(cid:82)(cid:90)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)approximately 30% of uninsured residents had incomes at 138% Federal Poverty Level (FPL) or below and would be eligible for Medicaid if it was expanded.9 The same study estimates that over 50% of (cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86) uninsured have incomes between 138% and 400% of the Federal Poverty Level (FPL) and will be eligible for federal subsidies to assist with the purchase of health insurance through a Health Benefits Exchange.10                                                                                                                       8 2011 State of Wyoming Department of Insurance, Health Benefits Exchange Planning and Actuarial Health Insurance Market Study, Final Report, Public Consulting Group & Gorman Actuarial, LLC 9 2011 State of Wyoming Department of Insurance, Health Benefits Exchange Planning and Actuarial Health Insurance Market Study, Final Report, Public Consulting Group & Gorman Actuarial, LLC 10 2011 State of Wyoming Department of Insurance, Health Benefits Exchange Planning and Actuarial Health Insurance Market Study, Final Report, Gorman Actuarial, LLC 6 However, if Wyoming chooses not to expand its Medicaid program, residents under 100% FPL will not be eligible for federal subsidies and will not have access to Medicaid. Effects of Being Uninsured A recent report released by The Kaiser Commission on Medicaid and the Uninsured discussed the negative impacts of being uninsured. The report stated that t(cid:75)(cid:72)(cid:3)(cid:179)uninsured population is in worse health than t(cid:75)(cid:72)(cid:3)(cid:83)(cid:85)(cid:76)(cid:89)(cid:68)(cid:87)(cid:72)(cid:79)(cid:92)(cid:3)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:72)(cid:71)(cid:3)(cid:83)(cid:82)(cid:83)(cid:88)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:180)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:179)(cid:62)(cid:88)(cid:64)ninsured adults are almost twice (cid:68)(cid:86)(cid:3)(cid:79)(cid:76)(cid:78)(cid:72)(cid:79)(cid:92)(cid:3)(cid:87)(cid:82)(cid:3)(cid:85)(cid:72)(cid:83)(cid:82)(cid:85)(cid:87)(cid:3)(cid:69)(cid:72)(cid:76)(cid:81)(cid:74)(cid:3)(cid:76)(cid:81)(cid:3)(cid:73)(cid:68)(cid:76)(cid:85)(cid:3)(cid:82)(cid:85)(cid:3)(cid:83)(cid:82)(cid:82)(cid:85)(cid:3)(cid:75)(cid:72)(cid:68)(cid:79)(cid:87)(cid:75)(cid:3)(cid:68)(cid:86)(cid:3)(cid:87)(cid:75)(cid:82)(cid:86)(cid:72)(cid:3)(cid:90)(cid:76)(cid:87)(cid:75)(cid:3)(cid:83)(cid:85)(cid:76)(cid:89)(cid:68)(cid:87)(cid:72)(cid:3)(cid:76)(cid:81)(cid:86)(cid:88)(cid:85)(cid:68)(cid:81)(cid:70)(cid:72)(cid:17)(cid:180)11 More than a third of nonelderly uninsured adults have a chronic condition, and uninsured adults are far more likely than the insured to go without health care. Without regular check-ups, health problems may go undetected. As a result, the uninsured have higher risk of being diagnosed in later stages of disease and die earlier than the insured. Even after diagnosis, the uninsured struggle to adhere to follow-up care plans due to the cost. Uninsured adults are more likely than those with insurance to have unmet health care needs.12 The uninsured suffer financially, as well. They are much more likely than their insured counterparts to have trouble paying their medical bills, more likely to spend significant savings paying medical bills, and more likely to have medical bills they simply cannot pay.13 The Working Uninsured Americans largely rely on employer sponsored health care coverage. Most insured Americans (56%) under the age of 65 receive coverage as an employment benefit.14 When employers do not offer health care coverage as a benefit of employment, workers and 2011  Family  Work  Status  Among  the   their families, especially low No   Uninsured income workers, may find it Workers,   difficult to afford adequate 22% coverage. Nationally, 76% of people that are 1  or  More   Part-­‐Time   Full-­‐Time   uninsured are in a family that has Workers,   Workers,   part-time or full-time workers. 14% 62% Only 22% of the uninsured are in a family with no workers. Blue collar workers are more than twice as likely to be uninsured as white collar workers. In fact, 80% of uninsured workers are in blue collar jobs.15                                                                                                                       11 Kaiser Commission on Medicaid and the Uninsured. The Uninsured| A Primer. October 2012. Kaiser report found at http://www.kff.org/uninsured/upload/7451-08.pdf 12 Kaiser report, The Uninsured| A Primer 13 Kaiser report, The Uninsured| A Primer 14 Kaiser report, The Uninsured| A Primer 15 Kaiser Commission on Medicaid and the Uninsured. The Uninsured| A Primer. October 2012. Kaiser report found at http://www.kff.org/uninsured/upload/7451-08.pdf 7 Low income individuals are most at risk for not having insurance. These individuals may be working, but do not earn enough to pay for health insurance premiums. Impediments to people under 138% obtaining health insurance coverage include: employers not offering health insurance; part-time workers and contractual workers not receiving the same benefits as full-time workers; monthly premium costs are too high to afford; or they are self-employed and struggle with the cost of health insurance. The expansion of Medicaid to adults under 138% FPL would permit the working uninsured to access health care coverage. It would also benefit their employers who are often financially unable to provide health care coverage to their employees.                                                                                                                                                                                                                                                                                                                                                                                       Figure source: Kaiser Commission on Medicaid and Uninsured/Urban Institute, Figure 4, The Uninsured A Primer, October 2012 8 SECTION IV: WHAT IS THE CHOICE? Elected officials in Wyoming now have a choice whether or not to expand Wyoming Medicaid to low-income adults. However, regardless of the decision, there are two mandatory groups that must be provided coverage. They are the woodwork population and the newly eligible children. This Section separately discusses the mandatory coverage requirements and the optional Medicaid expansion. Mandatory Groups The individual mandate and increased attention to health care coverage created by the ACA will lead some individuals who are already eligible for Medicaid, but not enrolled, to enroll. This (cid:74)(cid:85)(cid:82)(cid:88)(cid:83)(cid:3)(cid:76)(cid:86)(cid:3)(cid:70)(cid:82)(cid:80)(cid:80)(cid:82)(cid:81)(cid:79)(cid:92)(cid:3)(cid:85)(cid:72)(cid:73)(cid:72)(cid:85)(cid:85)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:68)(cid:86)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:179)(cid:90)(cid:82)(cid:82)(cid:71)(cid:90)(cid:82)(cid:85)(cid:78)(cid:3)(cid:83)(cid:82)(cid:83)(cid:88)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:180)(cid:3)(cid:69)(cid:72)(cid:70)(cid:68)(cid:88)(cid:86)(cid:72)(cid:3)(cid:76)(cid:87)(cid:3)(cid:76)(cid:86)(cid:3)(cid:87)(cid:75)(cid:82)(cid:88)(cid:74)(cid:75)(cid:87)(cid:3)(cid:87)(cid:75)(cid:68)(cid:87)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:38)(cid:36)(cid:3) (cid:90)(cid:76)(cid:79)(cid:79)(cid:3)(cid:69)(cid:85)(cid:76)(cid:81)(cid:74)(cid:3)(cid:87)(cid:75)(cid:72)(cid:80)(cid:3)(cid:179)(cid:82)(cid:88)(cid:87)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:90)(cid:82)(cid:82)(cid:71)(cid:90)(cid:82)(cid:85)(cid:78)(cid:180)(cid:3)(cid:87)(cid:82)(cid:3)(cid:72)(cid:81)(cid:85)(cid:82)(cid:79)(cid:79)(cid:3)(cid:76)(cid:81)(cid:3)(cid:48)(cid:72)(cid:71)(cid:76)(cid:70)(cid:68)(cid:76)(cid:71)(cid:17) Because this population is currently eligible for Medicaid under its existing policies, this group is to be treated as any eligible person is treated today. If they are eligible, they must be covered. Additionally, the federal government will match only 50% of the cost of their coverage, which is the existing Federal Medical Assistance Percentage (FMAP) 16 for Wyoming. In addition to the woodwork population, the ACA requires the existing Medicaid program to add coverage for children ages 6-18 whose family income is between 100% and 138% FPL. Currently these children are elig(cid:76)(cid:69)(cid:79)(cid:72)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:46)(cid:76)(cid:71)(cid:3)(cid:38)(cid:68)(cid:85)(cid:72)(cid:3)(cid:38)(cid:75)(cid:76)(cid:79)(cid:71)(cid:85)(cid:72)(cid:81)(cid:182)(cid:86)(cid:3)(cid:43)(cid:72)(cid:68)(cid:79)(cid:87)(cid:75)(cid:3)(cid:44)(cid:81)(cid:86)(cid:88)(cid:85)(cid:68)(cid:81)(cid:70)(cid:72)(cid:3)(cid:51)(cid:85)(cid:82)(cid:74)(cid:85)(cid:68)(cid:80)(cid:3)(cid:11)(cid:38)(cid:43)(cid:44)(cid:51)(cid:12)(cid:15)(cid:3) but not Medicaid. This group of children is mandatory and is not affected by the recent Supreme Court decision.17 The coverage of the woodwork population and additional children is mandatory. The cost of covering these groups can be expected whether or not the State elects to expand its Medicaid program. Upon legislative mandate, the Wyoming Department of Health sought estimates for the number of additional Medicaid enrollees due to the required Medicaid coverage of mandatory groups.18 Estimates received by Wyoming Department of Health (cid:73)(cid:82)(cid:85)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:179)(cid:90)(cid:82)(cid:82)(cid:71)(cid:90)(cid:82)(cid:85)(cid:78)(cid:3)(cid:83)(cid:82)(cid:83)(cid:88)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:180)(cid:3)(cid:85)(cid:68)(cid:81)(cid:74)(cid:72)(cid:71)(cid:3) from 700 to 10,800 individuals, with a best estimate of 3,700 individuals. Estimates received for the newly eligible children ranged from 4,600 to 10,800 children, with a best estimate of 6,900 children. Table 1 outlines the best estimate of mandatory group enrollment for Wyoming.                                                                                                                       16 (cid:55)(cid:75)(cid:72)(cid:3)(cid:41)(cid:48)(cid:36)(cid:51)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:179)(cid:90)(cid:82)(cid:82)(cid:71)(cid:90)(cid:82)(cid:85)(cid:78)(cid:180)(cid:3)(cid:83)(cid:82)(cid:83)(cid:88)(cid:79)(cid:68)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)(cid:90)(cid:76)(cid:79)(cid:79)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:69)(cid:72)(cid:3)(cid:72)(cid:81)(cid:75)(cid:68)(cid:81)(cid:70)(cid:72)(cid:71)(cid:17)(cid:3)(cid:3)(cid:41)(cid:82)(cid:85) this population the FMAP will be at (cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:182)(cid:86)(cid:3)(cid:70)(cid:88)(cid:85)(cid:85)(cid:72)(cid:81)(cid:87)(cid:3)(cid:85)(cid:68)(cid:87)(cid:72)(cid:15)(cid:3)(cid:90)(cid:75)(cid:76)(cid:70)(cid:75)(cid:3)(cid:75)(cid:68)(cid:86)(cid:3)(cid:69)(cid:72)(cid:72)(cid:81)(cid:3)(cid:24)(cid:19)(cid:8)(cid:3)(cid:86)(cid:76)(cid:81)(cid:70)(cid:72)(cid:3)(cid:21)(cid:19)(cid:20)(cid:20)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:76)(cid:86)(cid:3)(cid:83)(cid:85)(cid:82)(cid:77)(cid:72)(cid:70)(cid:87)(cid:72)(cid:71)(cid:3)(cid:87)(cid:82)(cid:3)(cid:69)(cid:72)(cid:3)(cid:68)(cid:87)(cid:3)(cid:24)(cid:19)(cid:8)(cid:3)(cid:87)(cid:75)(cid:85)(cid:82)(cid:88)(cid:74)(cid:75)(cid:3)(cid:21)(cid:19)(cid:21)(cid:19)(cid:17)(cid:3)(cid:3)(cid:58)(cid:92)(cid:82)(cid:80)(cid:76)(cid:81)(cid:74)(cid:3)(cid:70)(cid:68)(cid:81)(cid:3) expect an increase in this population whether or not it expands its Medicaid program. The children newly eligible for Medicaid due to the expansion are also not eligible for the full-enhanced FMAP discussed above. 17 Additionally, this group of kids is not covered at the 100% enhanced FMAP offered for newly eligible adults. See http://www.kff.org/healthreform/upload/8348.pdf 18 These numbers were taken from a report written by Milliman, Inc. in fulfillment of the requirements of Enrolled Act No. 93, Senate, Sixty-First Legislature of the State of Wyoming, 2011 General Session. The final report was completed on September 1, 2012. This Milliman Medicaid Cost Study is available on the Department of Health website at http://www.health.wyo.gov 9