“I haven’t signed up for my Medicaid because it’s so confusing, and because I don’t have a way to pay for it,” Tuck, 61, said by phone from the public library in downtown Indianapolis, where he was looking for help finding insurance. “Sometimes I’d go to the emergency room. But if you don’t have insurance, they just keep you waiting for hours and do the bare minimum to keep you alive.”
Indiana is at the leading edge of Republican efforts to shift Medicaid in a more conservative direction — with the Trump administration giving the green light to states to shift some of the burden for the program onto the poor.
Indiana began asking the destitute to pay a monthly premium for some Medicaid services in 2015, as part of a deal with the Obama administration to expand the program. But more recent moves by Kentucky, Maine and Wisconsin seeking to ramp up patients’ payments do not include a goal of expanding the 53-year-old program.
Last month, the Trump administration approved Kentucky’s petition to raise premiums and impose work requirements for Medicaid. Earlier this month, the administration approved Indiana’s plan to raise premiums for poor people who smoke tobacco.
Some health care experts say these new Medicaid policies mark a major shift. Medicaid is funded largely by federal dollars, but administered by the states.
“These are fundamental changes for a program specifically created to serve people with very low incomes,” said Cindy Mann, who spent five years overseeing Medicaid under the Obama administration.
The new Medicaid premiums come at a time when the Trump administration is seeking to overhaul the social safety net. Conservatives say the changes, which give poor people additional responsibilities for obtaining government benefits, will encourage them to join the workforce.
Critics say the requirements will push more people into poverty. The Trump administration also plans on unveiling legislation to create work requirements for public housing programs, and recently called for transforming the nation’s food assistance program.
“A big part of the rationale behind what they’re doing is the idea that these people are not intended to be beneficiaries of Medicaid, despite the law saying that they are,” said Judith Solomon, a health policy expert at the Center on Budget and Policy Priorities. “This is part of an overall agenda, as evidencedby the budget and elsewhere in the Trump administration, that would take away health care and food and rental assistance including for working families. All these pieces go together.”
In an email, Trump officials said that allowing states to increase premiums for Medicaid enrollees would lead to more “responsible decision-making.”
“We believe that demonstration proposals that strengthen beneficiary engagement in their personal health care plan and enhance alignment between Medicaid policies and commercial health insurance products can support Medicaid’s objectives by promoting responsible decision-making and facilitating smoother beneficiary transitions,” a spokesman for the Centers for Medicare and Medicaid Services said in a statement.
Before the Affordable Care Act, about two dozen states had some form of premiums for Medicaid or the Children’s Health Insurance Program, according to a Georgetown University study published in 2009. Many of these states implemented premiums to help raise money to cover more people under Medicaid.
But now some states are pursuing costlier premiums than what the Obama administration permitted, or are introducing penalties for failing to pay those premiums, according to MaryBeth Musumeci, associate director at the Kaiser Family Foundation. And unlike prior administrations, the Trump administration is poised to permit states to enact premiums without also guaranteeing expanded coverage in exchange.
Federal law prohibits states from imposing Medicaid premiums on anyone earning under 150 percent of the federal poverty line, or those earning less than $18,000 annually, depending on household size.
But the federal government has long issued waivers to the states allowing them to tailor their own Medicaid programs. The Obama administration granted waivers to Republican-led states including Iowa, Michigan and Indiana as part of bigger deals in which those states also agreed to expand the number of their residents on Medicaid. Indiana expanded coverage to 400,000 people but also imposed premiums on very-low-income populations and denied vision and dental coverage to those who don’t pay premiums. Indiana was also allowed to kick people off the program who failed to make limited premium payments, although only if they were above the poverty line.
But while the Obama administration agreed to let some states impose premiums on the poor, they defined certain limits. States were not allowed to charge premiums of greater than 2 percent of beneficiaries’ income. They could not impose work requirements.
The proposals also had to expand net enrollment in the state.
But after Republicans in Congress failed last year to repeal the Affordable Care Act, the Trump administration dropped the requirement for expanding coverage when considering states’ proposals for overhauling Medicaid.
“We will not just accept the hollow victory of numbers covered,” said Seema Verma, Trump’s administrator of the Centers for Medicare and Medicaid Services, at the time.
Kentucky’s plan was the first accepted under the new guidelines. It imposes new premiums and work requirements, and is expected to reduce the Medicaid population by as many as 95,000 people annually. It increases the premiums to up to 4 percent of beneficiaries’ income.
Earlier this month, federal officials approved a plan submitted by Indiana’s Republican governor to introduce work requirements, as well as a 50 percent surcharge on premiums for tobacco users. That means Indiana’s Medicaid premiums, at least for tobacco users, will be above the 2 percent set as the guideline under Obama.
Meanwhile, Wisconsin wants to impose premiums on those below the federal poverty line with no increase in coverage.
Maine has submitted a waiver to impose mandatory payments on those earning as little as $6,000 annually with no proposed corresponding increase in coverage, as well as new premiums for a health-care program that poor parents can use while leaving welfare programs to join the workforce.
Maine’s premiums are aimed at encouraging Medicaid beneficiaries to find health care through their employer, “promoting individual responsibility for one’s own health and health care costs,” said Emily Spencer, a spokeswoman for Maine Gov. Paul LePage, a Republican, in a statement.
Wisconsin, North Carolina and Maine are also seeking to become the first states to introduce penalties for Medicaid enrollees whose earnings put them well beneath the federal poverty line.
North Carolina’s plan would take away insurance from poor people who missed premium payments after a 60-day “grace period.” (Unlike the other states mentioned, North Carolina is asking to use this authority only if it also expands Medicaid.) Wisconsin would drug-test Medicaid recipients and lock out enrollees who fail to pay the program for six months. Maine wants to impose a 90-day lockout period for those who miss premium payments, including for those below the poverty line.
In North Dakota, meanwhile, lawmakers told The Washington Post that they will consider adding new premiums in light of the Trump administration’s recent approval of Kentucky’s plan.
Conservative supporters of the policies say they encourage the poor to take responsibility for their health. “There needs to be some skin in the game,” said state Sen. Judy E. Lee, the Republican chair of the North Dakota state senate’s health services committee. “There’s a difference to how people respond when they might have to pay $2 to $3, and the flexibility we’re seeing from the Trump administration is very important.”
Liberals called the premiums a backdoor attempt to undermine Medicaid after Senate Republicans failed to pass legislation through Congress last year. Many of the GOP bills that came close to passage would have dramatically rolled back the ACA’s Medicaid expansion.
“This is a big part of the Trump administration’s war on Medicaid,” said Ari Ne’eman, who served on the National Council on Disability under President Barack Obama. “We are talking about populations of people, many of whom are facing significant challenges associated with poverty, and adding an additional administrative burden is needlessly cruel and offers no meaningful policy rationale.”
Experts and state officials have produced varying estimates about the number of people who could lose coverage under the premium changes. After Oregon implemented a premium package in 2003 with limited premiums, enrollment from beneficiaries with no income fell from about 42,000 to 17,500 — a 58 percent drop — in one year.
Wisconsin estimates its waiver would lead to about 5,000 fewer residents having Medicaid every year, with about 1,000 of those losses coming from the new premiums. Maine projects its plan would reduce state Medicaid enrollees by 55,000, although many of these losses are likely due to new work requirements and other enrollment changes in the program.
Kentucky’s Medicaid expansion, started in 2015, added more than 443,000 adults to the insurance program. Its waiver — which includes both new premiums and work requirements — is expected to lower enrollment by about 95,000 people in its fifth year of implementation. It does not say how many of those losses stem from new premiums.
The poor and the sick are the least likely to meet Medicaid premium payments, with some research indicating that families of color are particularly likely to lose coverage, according to the Kaiser Family Foundation.
Indiana’s plan, which started when Vice President Mike Pence was the state’s governor and was crafted in part with Verma’s help, may offer the best test case for evaluating the impact of imposing premiums on the poor.
Beneficiaries below the poverty line choose between paying a monthly premium (between $1 and $15, depending on income) for a plan that offers medical care and limited dental and vision care, or entering a plan that requires co-payments for basic medical services, with no dental or vision coverage.
In the first two years of the program, at least 25,000 people above the poverty line lost Medicaid for failing to meet payments. Another 46,000 people who were qualified and signed up for Medicaid never got access because they failed to pay their initial premiums, according to a state study, which also found that 55 percent of all eligible Indiana residents did not enroll in the more robust plan.
After the policy was enacted, anti-poverty advocate Maurice Young began searching Indianapolis’s streets, parks and public libraries to enroll the homeless in Medicaid, raising money from local companies and nonprofits to cover their $12 charges for the year, as well as the cost of stamps.
Over the past three years, Young’s group has helped about 1,000 people enroll in Medicaid. “I couldn’t figure out why so many sick homeless people weren’t using their Medicaid,” Young said. “And then I realized it was because they couldn’t afford it.”
