Opt-out on Medicaid would have odd result

If Florida says no to Medicaid expansion, as the Supreme Court has said it can, it will forgo billions in federal aid over the next 10 years to save a fraction of that amount.

Also, it would mean leaving more than 1 million of the state's poorest citizens uninsured, while middle-class and modest-income workers would be able to buy health insurance through exchanges -- in many cases with federal subsidies.

As the Washington Postreported today, a state that decides not to expand its Medicaid program will leave a "donut hole" in coverage that affects the very poorest citizens.

“There is a real debate here where states are going to have to weigh leaving huge amounts of federal dollars on the table versus accepting potential exposure in the future,” said Matt Salo, executive director of the National Association of State Medicaid Directors, according to the Post. “Before, you just had to just hold your nose and do it.”

Authors of the Affordable Care Act assigned those with incomes of less than 133 percent of the federal poverty level -- about $30,000 for a family of four -- to the Medicaid expansion. Those who earned between that and 400 percent would be eligible for a sliding scale of subsidies to buy health insurance on the exchange.

The exchanges are supposed to be ready to go on Jan. 1, 2014. Florida has not started work on it and never spent federal grant money that had been provided for the effort.

In states that don't have an exchange -- an online marketplace where consumers can shop for coverage -- citizens will be able to use one set up by the federal government.

Florida Health Choices, a non-profit that is building an exchange for small employers in the state, is to go online this fall, with shopping for coverage that begins Jan. 1, 2013. It has taken four years since the law passed authorizing the operation.

Rose Naff, executive director, told Health News Florida today that she doesn't know how much work would be involved to convert that exchange into one that would meet federal standards. She said any decision would require action by not only the Florida Health Choices board but also the Legislature.

Back in 2010, Health News Floridareported that then-deputy insurance commissioner Mary Beth Senkewicz told the Choices board members that they would be "well-positioned" to move into the role of the ACA-required exchange "if you are willing to adapt."

Meanwhile, as several publications reported today, legislative leaders have said they will be cautious about expanding Medicaid, given their fear of potential costs down the road.

The ACA provides 100 percent federal coverage of the Medicaid expansion for three years; in 2017 the state begins to pay a small share of the cost, until it is responsible for 10 percent as of 2020.

As the Sarasota Herald-Tribune reported today, there has been a wide range of state cost predictions for the Medicaid expansion, based on varying assumptions. The state Agency for Health Care Administration is at the top end, with a projection of more than $7.5 billion over the next decade, but the Florida Center for Fiscal and Economic Policy said it would be likely be just over $2 billion.

Meanwhile, the Center's analysis said, federal funds coming into Florida over the decade for the Medicaid expansion would be close to $20 billion -- or $9.50 for every state dollar spent.