Just in time for Christmas, and more importantly in time to get the program up and running by January 1st, federal CMS has granted Iowa’s request for two Section 1115 waivers to allow the state to pursue its own version of Medicaid expansion.
This is good news for the more than 100,000 Iowans who stand to gain coverage over the next few years, according to the state’s estimates. And as readers of Say Ahh! know, covering more parents will lead to more kids in the state of Iowa being covered as well.
I am just crashing through the newly released documents, but it looks like CMS gave the governor most of what he asked for. The state will be using a couple of different approaches to do premium assistance for the expansion population – first by beefing up their Section 1906 Medicaid premium assistance program (which I think is a sensible idea for any state going down this path), and second, by putting the newly eligible population with incomes between 100-133% of FPL into the new exchange/marketplace. The state will also be creating a new wellness program.
This second premium assistance approach has raised more questions as readers of SayAhh! know, but I personally think it is wiser to put this segment (i.e. the 100-133% of FPL) of the newly eligible into the exchange, rather than the entire population as Arkansas is doing. Still, this will need to be studied carefully.
Unfortunately, CMS did approve Iowa’s request, albeit on a very limited basis, for a waiver of the non-emergency transportation benefit (for one-year with an evaluation planned) for those going into the exchange. This has been one of the concerns about an “Arkansas” style approach – whether Medicaid beneficiaries will continue to receive all of the same benefits and cost-sharing protections in the exchange that they would receive in Medicaid. (Note: Arkansas ended up not waiving any benefits in its agreement though there is some hint that they may come back in for such a waiver in the future. And this is the concern about Iowa going down this path even for one year—it’s a bad precedent.)
But on another key question - premiums - CMS split the difference. Medicaid law prohibits premiums being charged for those individuals below 150% of FPL and there is good reason for this - ample evidence suggests that premiums charged to persons with low incomes prevents them from getting coverage. However, the waiver agreement allows Iowa to charge premiums of up to 2% of income for those over the poverty line, but does not allow the state to charge premiums for those below. That is reassuring news because, as we expressed in our written comments with other national groups, charging premiums below poverty is a mistake, and states should not be allowed to go down the path. The premiums contemplated by the waiver are not scheduled to go into effect until 2015.
Iowa’s approach still has some flaws, and the administrative complexity of the system the state is contemplating is somewhat mind-boggling. The wellness program is of questionable policy value – we will blog on that more in the future.
So many of the kinks will have to be worked out over time. Still, the waiver approval is good news and will get coverage up and running for the many thousands of Iowans who stand to benefit.