The state and federal government could be paying for more than half of all health care bills in Idaho within a decade, according to Dick Armstrong, head of the Idaho Department of Health and Welfare (DHW).
Armstrong briefed state lawmakers on the Health Care Task Force Tuesday about the changes coming to government-backed health insurance programs as a result of new health care laws approved by Congress earlier this year. However, the new federal plans could soon change due to the Republican gains in Congress.
While some of the changes to health insurance are already in place, most changes won’t start until 2014. Starting that year, more than 100,000 more Idahoans will be newly eligible for Medicaid. Most of that increased cost—more than $200 million in 2014—would be paid by the federal government.
“The feds are going to cover a good portion of the expansion groups, however, that funding will go away,” Armstrong told lawmakers Monday. According to DHW estimates, by 2020, the federal government would pay for 86 percent of the costs of new Medicaid enrollees.
The new law also prevents states from making changes to Medicaid eligibility until 2014. Medicaid currently provides health services for approximately 200,000 children and adults who are low-income families, have a disability, are elderly, or are pregnant. The changes in the the law would open it up to all people under 65 who earn up to 133 percent of the poverty level. Americans over 65 are eligible for Medicare, which is fully paid by the federal government. Idaho pays a minority share of Medicaid costs.
Armstrong said that by 2020, about one in four Idahoans would be on Medicaid, with another 15 percent on Medicare. Public employees also often have their health insurance taken care of by the government. “It’s pretty easy to see that we will have federal and state dollars in some way representing over 50 percent of the health care budget in Idaho,” Armstrong said.
The health care changes aren’t set in stone, and could face changes in Congress. State lawmakers on the task force also heard from Joy Wilson, the health care policy director for the National Conference of State Legislatures. She said the new Republican majority in the U.S. House of Representatives has the health care plan in its cross hairs.
Idaho Congressman-elect Raul Labrador has said he wants to repeal the law, but Wilson said that’s easier said than done. “The fastest way to slow down health reform would be through the appropriations process,” Wilson told lawmakers. If Congress doesn’t fund the Medicaid expansion, the program wouldn’t be open to more Idahoans.
Wilson also said another potential change garnering interest among states is an opt-out provision for states that make their own health care reforms. The current state waivers, championed by Sen. Ron Wyden, D-Ore., could be expanded to give states more flexibility. “I think that might be one of the first consensus kind of bills that would come out of the new Congress related to health reform,” Wilson said.
Idaho Department of Insurance Director Bill Deal also briefed lawmakers about other changes from the health care laws, including a state-run exchange where Idahoans could choose among different health care plans. Read IdahoReporter.com‘s interview with Deal here.
With the major changes to Medicaid several years down the road, lawmakers remain focused on how to balance spending for DHW and Medicaid. The state Medicaid budget will need an additional $200 million during the next 20 months, according to Armstrong. That shortfall is due in part to a decline in share of Medicaid being paid by the federal government.