Nashua Telegraph: Director tells Medicaid panel contracts will have to be renegotiated if expansion turned down
By KEVIN LANDRIGAN
CONCORD – If lawmakers fail to expand Medicaid – government-paid insurance for the poor and disabled – then the largest contract in state history must be renegotiated with the three firms hired to better manage that care, state officials said Tuesday.
Medicaid Director Katie Dunn said the 2012 contracts signed with those firms, worth $381 million annually, assumed that Medicaid expansion would occur because the federal Affordable Care Act had required states to do it.
Last July, the U.S. Supreme Court struck down that mandate and gave states the right to decide if they wished to extend coverage.
“If we get to the place where the decision is not to expand Medicaid, we will have to go back and pretty much renegotiate the whole program,” Dunn told the 11-member commission created to study the issue. “I am not saying it’s a good thing or a bad thing; that is what would need to happen.”
The firms priced bids assuming that expansion would come and add nearly 60,000 people onto Medicaid.
State health officials plan early next year to convert those on Medicaid from a fee-for-service to an HMO-style managed care plan.
Well Sense Health Plan, Granite State Health Plan and Meridian Health Plan of New Hampshire are chosen providers for these services with the first phase delivery of primary care, pharmacy and mental health services for the entire Medicaid population.
A year later, the second phase would be specialty services to include nursing home care and special care for the developmentally disabled.
At this commission’s second meeting, members set July 30 to take public comment and Aug. 6 to hear from federal health officials.
In the meantime, the commission will discuss who to hire as a private consultant to advise them and which insurance or health care experts should be invited to speak. The state budget gave the commission a $200,000 budget.
The focus of this meeting initially was to explain the existing program, but battle lines were renewed between those who favor and oppose expansion.
Jeff McLynch, executive director of the left-leaning New Hampshire Fiscal Policy Institute, said expansion would enhance an already successful Medicaid program.
“As commission members learn more, we trust they will understand the importance of accepting federal funds to get more families covered in New Hampshire,” McLynch said in a statement. “Not only will expanded coverage reduce the costs associated with people who can’t afford insurance, it will give families the security they need to thrive and help this state grow.”
Greg Moore, state director for Americans for Prosperity, a conservative interest group, said there’s no reason to move tens of thousands now getting private health insurance onto Medicaid.
“That’s all the more reason not to start bringing chaos to the program that delivers services to many disabled individuals that truly depend on this system,” Moore said. “That’s why this panel should take a pass on the Obamacare Medicaid expansion that would dump tens of thousands of New Hampshire residents who have quality private health insurance onto a substandard Medicaid system that is already in flux.”
The Kaiser Foundation reports that 23 states and the District of Columbia have agreed to Medicaid expansion, 21 states turned it down, and New Hampshire is among the remaining six to decide.
The Affordable Care Act offers 100 percent federal aid for the next three years to states that expand Medicaid for anyone earning up to 138 percent of the poverty level, which is roughly $32,500 for a family of four.
Then, the reimbursement drops to 90 percent.
The expansion would pump $2.5 billion in federal payments into the state over the next seven years.
The state’s administrative costs over that period would be $85 million, according to the Lewin Group, a private company that reported on expanding Medicaid for the Department of Health and Human Services.
About 130,000 in the state are on Medicaid, consisting largely of low-income women, children, expectant mothers and poor adults with disabilities.
The state gets 50 percent federal support to give Medicaid insurance to this group, and at $1.4 billion, it’s the single largest item in the state budget.
The expansion would offer coverage to 24,000 adults who lack insurance now, and an estimated 36,000 others with private insurance would migrate to the Medicaid program.