Medicaid Expansion in Michigan

This information comes from FCOM, or Free Clinics of Michigan:

Time to celebrate – Medicaid expansion has PASSED in the Michigan Senate!

 For those who have not been following the Senate in the months of the tantalizingly slow process to expand Medicaid, here is what has happened:

 On June 12, 2013, the Michigan House of Representatives voted to pass the Medicaid expansion bill, HB 4714. The result was 9 votes in support of the bill, and 5 votes against it.

The bill then went to the Michigan Senate for a vote, but with an insufficient number of the majority party (Republican) agreeing to take a vote, Majority Leader, Senator Randy Richardville (R-Monroe) decided to postpone the vote until after the summer break. He assigned a group of six Republican senators to study and amend the bill over the summer, so the Senate would have a refined piece of legislation to vote on upon their return in August. Governor Snyder (Republican) was upset by the fact the Senate had refused to take a vote, and he spent his summer traveling across the state to increase support for the expansion, also requesting that voters contact their senators and ask them to, “Take a vote, not a vacation.” While the senators met periodically throughout the summer, a vote was never taken during the break; however, when the senate returned to start a new session on August 27, 2013, it was a high priority agenda item.

While the senators assigned to the bill over the summer made some minor adjustments, HB 4714 remained basically intact. There were, however, two other bills that were designed by Republican senators, Patrick Colbeck and Bruce Caswell, which were allowed to be presented as well. Both reforms essentially scratched the Medicaid plan altogether, and both were rejected by the senate.

After many hours of debates, votes on other bills, and recesses, the time for the much anticipated vote on HB 4714 finally arrived. The vote resulted in a 19-18 vote, with Senator Patrick Colbeck abstaining from the vote. Despite the majority in behalf of the expansion, a bill cannot pass without a minimum of 20 votes in support. Had Senator Colbeck cast his vote very likely ‘no’ vote, there would have been a 19-19 tie, and Lt. Governor Brian Calley would have been ready to cast the tie-breaking vote in support of the expansion.

Just when it looked as though all hope was lost for the expansion, a surprising turn of events led to a vote to reconsider the bill immediately. An amendment was added that stated that hospitals will not be allowed to charge Medicaid patients more than 115% of what they charge Medicare patients. With this amendment, a new vote was taken around 8 p.m., and the vote ended in a 20-18 vote in support of the expansion, after Senator Tom Casperson (R- Escanaba) switched his initial ‘no’ vote to a ‘yes.’

Despite the bill passing, there is a required two-thirds majority for a bill to go into immediate effect. Because there was only a simple majority, the expansion cannot take effect until at least April 1, 2014, or an Immediate Effect (IE) vote is approved by the Senate. Unfortunately the delay will cost the state approximately $7 million dollars from the federal government for every day it is not implemented, but Medicaid expansion will be moving forward.

While the bill has passed in the Michigan Senate, it must now return to the Michigan House of Representatives for another vote, due to the minor amendments added to their original bill, and then passed onto the federal government for the final approval.

 

What does this mean for the State?

Currently, most of those covered by Medicaid are children and those with incomes less than half of the poverty line. This leaves many citizens unable to afford private health coverage, and unable to qualify for Medicaid. With the passage of the bill, citizens earning up to 133% of the Federal Poverty Line (FPL), or approximately $15,282 for an individual and $31,322 for a family of four, will become eligible for Medicaid once the bill goes into effect. In the next few years, it is expected that approximately 470,000 additional Michiganders will be eligible for insurance under this reform. The expansion, or “Healthy Michigan,” as it is referred to by Governor Snyder, will be paid for in full by the federal government until 2017. This contribution will gradually decline until it hits 90% in 2020, where it will remain.

Individuals covered by Medicaid will be helping to fill the gap as the amount contributed by the federal government declines. As part of the bill, newly covered individuals will be required to contribute 5% of their medical costs. This number will increase to 7% after 48-months, unless deemed otherwise on a case-by-case basis.

With the expansion underway, it is expected that the number of emergency room visits will decrease and will no longer be a very expensive alternative for primary care of routine visits. This should also lead to better health benefits of these individuals, as they will be able to see a regular health care provider who will get to know their circumstances, and health history, to provide the best care.