Teh One Who Knocks
08-31-2011, 05:57 PM
By Tim Hoover - The Denver Post
Two years after lawmakers expanded Medicaid to cover poor adults without children, the state is vastly scaling back the program because the number of people eligible for coverage is nearly three times as high as first projected and the cost of insuring them is almost nine times original estimates.
The new coverage followed the 2009 passage of major health care legislation that allowed the state to impose a fee on hospitals while drawing down matching federal money to expand Medicaid coverage.
House Bill 1293 was estimated to generate about $1.2 billion for Medicaid programs when fully phased in, and the measure called for expanding eligibility levels. A new eligibility class was created for adults without dependent children and whose income was up to 100 percent of the federal poverty level, or $10,890 per year for an individual.
"Our original caseload numbers and costs were based on the information that existed two years ago," said Joanne Zahora, a spokeswoman for the Department of Health Care Policy and Financing, the agency that manages Medicaid.
Colorado at that time looked to other states to formulate its estimates, but there were few examples, Zahora said. And states that had only recently started similar programs soon started seeing their estimates fall far short too, she said.
"After more in-depth research, we found that the number of eligible clients and the costs per client (in Colorado) were much higher than could be imagined," Zahora said.
Original fiscal estimates projected that when fully phased in, there would be 49,200 people eligible for the program at a cost of $197.4 million per year. That cost also included an estimate of annual medical costs of $3,50 per person, or about $292 a month.
But recent studies done by the private Colorado Health Institute show there are an estimated 143,000 dependentless adults living at or below the federal poverty level in Colorado. Many of these adults also are homeless men with expensive, chronic health conditions like hypertension, diabetes and HIV.
The costs are now estimated to be closer to $900 a month per individual, and if everyone up to 100 percent of the poverty level were covered, the newest estimates show, it would cost $1.75 billion — more than the entire amount of all Medicaid expansions covered under the hospital fee.
The Department of Health Care Policy and Financing now plans to reduce eligibility of the program to just 10 percent of the poverty level, meaning it would apply only to childless adults who earn less than $91 a month. But even at that level, covering all of the state's 49,511 childless adults who qualify would cost $770 million.
So, the department is going a step further. It plans to cap the number of people served by the program to just 10,000. Under that scenario, the coverage will cost an estimated $190 million over two years.
Those who don't sign up first for the program will be put on a waiting list, but in any case, the federal Affordable Care Act mandates all states extend Medicaid coverage to childless adults living at or below 133 percent of the federal poverty level by 2014. That coverage is to be paid for with federal funding.
Similar scenarios have played out in other states that have extended such coverage to childless adults — and some of the problems developed years earlier.
In Wisconsin, officials estimated 88,000 people would take advantage of a similar program, with 24,000 expected to enroll within the first year.
Instead, 25,000 people applied for coverage within the first two weeks, and four months later, there were 67,000 people enrolled and 70,000 people on a wait list.
In Indiana, the state reached an enrollment cap of 34,000 within the first year, and in Oregon, the state suspended enrollment in 2004, and in 2008, filled 10,00 waiting-list spots through a lottery.
"No states were able to implement their programs without major problems," Zahora said. "We have learned from these experiences and are establishing a wait list up front to avoid complications.
"We are being thoughtful and strategic about this implementation and are committed to being prudent and containing costs."
Advocates for the uninsured said the department's decision to scale back coverage was the only realistic option until 2014.
"I think it's a money issue, but it's also an appropriately cautious approach to (covering) a brand new population we've never served before," said Gretchen Hammer, executive director of the Colorado Coalition for the Medically Underserved.
"This is a group of very needy people who have not had access to adequate medical care," said Elizabeth Arenales, health care program director for the Colorado Center on Law and Policy. "We wish it were possible to cover more people now, but understand why we cannot."
Two years after lawmakers expanded Medicaid to cover poor adults without children, the state is vastly scaling back the program because the number of people eligible for coverage is nearly three times as high as first projected and the cost of insuring them is almost nine times original estimates.
The new coverage followed the 2009 passage of major health care legislation that allowed the state to impose a fee on hospitals while drawing down matching federal money to expand Medicaid coverage.
House Bill 1293 was estimated to generate about $1.2 billion for Medicaid programs when fully phased in, and the measure called for expanding eligibility levels. A new eligibility class was created for adults without dependent children and whose income was up to 100 percent of the federal poverty level, or $10,890 per year for an individual.
"Our original caseload numbers and costs were based on the information that existed two years ago," said Joanne Zahora, a spokeswoman for the Department of Health Care Policy and Financing, the agency that manages Medicaid.
Colorado at that time looked to other states to formulate its estimates, but there were few examples, Zahora said. And states that had only recently started similar programs soon started seeing their estimates fall far short too, she said.
"After more in-depth research, we found that the number of eligible clients and the costs per client (in Colorado) were much higher than could be imagined," Zahora said.
Original fiscal estimates projected that when fully phased in, there would be 49,200 people eligible for the program at a cost of $197.4 million per year. That cost also included an estimate of annual medical costs of $3,50 per person, or about $292 a month.
But recent studies done by the private Colorado Health Institute show there are an estimated 143,000 dependentless adults living at or below the federal poverty level in Colorado. Many of these adults also are homeless men with expensive, chronic health conditions like hypertension, diabetes and HIV.
The costs are now estimated to be closer to $900 a month per individual, and if everyone up to 100 percent of the poverty level were covered, the newest estimates show, it would cost $1.75 billion — more than the entire amount of all Medicaid expansions covered under the hospital fee.
The Department of Health Care Policy and Financing now plans to reduce eligibility of the program to just 10 percent of the poverty level, meaning it would apply only to childless adults who earn less than $91 a month. But even at that level, covering all of the state's 49,511 childless adults who qualify would cost $770 million.
So, the department is going a step further. It plans to cap the number of people served by the program to just 10,000. Under that scenario, the coverage will cost an estimated $190 million over two years.
Those who don't sign up first for the program will be put on a waiting list, but in any case, the federal Affordable Care Act mandates all states extend Medicaid coverage to childless adults living at or below 133 percent of the federal poverty level by 2014. That coverage is to be paid for with federal funding.
Similar scenarios have played out in other states that have extended such coverage to childless adults — and some of the problems developed years earlier.
In Wisconsin, officials estimated 88,000 people would take advantage of a similar program, with 24,000 expected to enroll within the first year.
Instead, 25,000 people applied for coverage within the first two weeks, and four months later, there were 67,000 people enrolled and 70,000 people on a wait list.
In Indiana, the state reached an enrollment cap of 34,000 within the first year, and in Oregon, the state suspended enrollment in 2004, and in 2008, filled 10,00 waiting-list spots through a lottery.
"No states were able to implement their programs without major problems," Zahora said. "We have learned from these experiences and are establishing a wait list up front to avoid complications.
"We are being thoughtful and strategic about this implementation and are committed to being prudent and containing costs."
Advocates for the uninsured said the department's decision to scale back coverage was the only realistic option until 2014.
"I think it's a money issue, but it's also an appropriately cautious approach to (covering) a brand new population we've never served before," said Gretchen Hammer, executive director of the Colorado Coalition for the Medically Underserved.
"This is a group of very needy people who have not had access to adequate medical care," said Elizabeth Arenales, health care program director for the Colorado Center on Law and Policy. "We wish it were possible to cover more people now, but understand why we cannot."