Two GOP-led states receive approval for Medicaid expansion cost-sharing provisions

January 12, 2015

Arkansas and Iowa, two GOP-led states, have received approval for customized options for Medicaid expansion that include cost-sharing provisions for beneficiaries.

Arkansas and Iowa, two GOP-led states, have received approval for customized Medicaid expansion optins that include cost-sharing provisions for beneficiaries.

The Centers for Medicare and Medicaid Services (CMS) sent letters to both states on December 30 indicating acceptance of waivers to the suggested model.

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In the Arkansas case, CMS has approved the state’s request to allow beneficiaries of Medicaid to deposit between $5 and $25 per month into a health savings plan depending on income. Beneficiaries who fail to contribute will not lose coverage, CMS noted.

Read the Arkansas letter and plan details here…

Arkansas received approval for a customized expansion plan in September 2013, but amended that request in September, 2014 to include cost-sharing for beneficiaries, according to the Kaiser Family Fund.

According to the CMS letter, enrollees under 50% of the federal poverty level (FPL) will not be required to make a deposit. Those earning more than 50% and up to 100% of the FPL will be required to contribute $5 a month to a health spending account (HSA); those earning more than 100% and up to 115% will be required to deposit $15 a month into an HSA; those earning more than 115% and up to 129% will be required to deposit $17.50; and those earning more than 129% and up to to 133% will be required to deposit $25.

Arkansas experienced a 22% drop in its uninsurance rate following the implementation of Medicaid expansion in 2013 – the largest drop of any state in the country, according to a Gallup poll.

In Iowa, which received approval in December, 2013 for its customized expansion option, CMS approved $5 monthly contributions for premiums for households with incomes from 50% to 100% of the FPL, and $10 per month for households with incomes from 101% to 133% of the FPL. As with the Arkansas plan, beneficiaries who fail to contribute will not lose coverage, according to the letter.

By mid-2014, Iowa had experienced a 10.4% drop in the uninsurance rate due to Medicaid expansion, according to the Gallup poll.

Read the Iowa letter and plan details here...

Twenty-eight states including the District of Columbia have received approval from  CMS  to expand Medicaid since the U.S Supreme Court decision in June 2012 made expansion a state option

As of December 2014, four of those states have implemented a customized expansion option: Pennsylvania, Michigan, Arkansas, and Iowa. CMS is currently reviewing a waiver proposal for Indiana, while Utah has received preliminary approval for its waiver proposal.