Charron: Idaho will spend $78M more if Medicaid expansion ends

If voters had not approved the expansion of Idaho Medicaid to low-income adults, Idahoans would have spent tens of millions of dollars more on health care for those patients.

If the state pulls back on its Medicaid coverage, Idahoans will spend nearly $78 million more due to the loss of federal funding, a state official told legislators Monday.

Idaho Medicaid is a state-run health insurance program. For decades, it was offered only to adults with disabilities, low-income children and, in some cases, their parents. When those Idahoans needed medical care, the federal budget paid most of the bill — about 70% to 75% of it, depending on the year. Idaho's Medicaid budget paid the rest.

What about other low-income Idaho adults, who couldn't afford health insurance and didn't qualify for Medicaid? When they needed medical care, the resulting medical bills often went unpaid — or, when they were paid, the money came from a hodgepodge of accounts funded by Idaho taxpayers.

When Idahoans approved the expansion by a vote of 60.6% in the 2018 election, it opened up Medicaid to those previously uninsured Idahoans. Because of provisions in the Affordable Care Act, the federal government promised to pay 90% of the medical bills for these newly insured patients.

Idaho lawmakers for years opted not to expand Medicaid. Still, federal law required Idahoans to pay into the federal budget for expansion.

The 2018 ballot measure opened the program to more people and changed how health care was paid for in Idaho.

Now, about 145,000 Idahoans have coverage through the Medicaid expansion.

"We know that it alleviates the burden on the state and counties to support the indigent population, allows the state to remove the (catastrophic medical bill fund), and we are now able to claim federal match for behavioral health services that were previously provided through state general funds. It also supports a healthier workforce and supports reduced health care costs and increased productivity," said Juliet Charron, administrator of Idaho Medicaid, during her presentation to the health and welfare committees of the Idaho House and Senate.

Because there are more people insured by the program, and because of their medical needs and the cost of medical care, the Medicaid budget has grown significantly.

But, as Charron explained Monday to members of the Idaho Legislature, Idaho taxpayers are actually paying less for medical care for those Idahoans. Those patients would still likely go to the hospital or need surgery or cancer treatment without Medicaid; but now, she explained, their bills are 90% covered by federal funding, instead of paid solely through Idahoans' taxes or not at all.

Hospitals in Idaho had to write off about $61 million less debt from unpaid bills since Medicaid expanded, Charron said.

The committees met Monday for an overview of the first three years of Idaho Medicaid expansion. The meeting was required by Idaho law, which orders legislators to "review all fiscal, health and other impacts" of the expansion and "make a recommendation" to the full Legislature on whether to continue the expansion.

Voters approved the expansion without sideboards, but state lawmakers ordered the Idaho Department of Health and Welfare to seek federal permission to add multiple sideboards and conditions to Medicaid coverage. Nearly all of those waiver requests have failed to gain approval from the Trump and Biden administrations, Charron explained.

Health and welfare committee members peppered Charron with questions about the expansion costs, how well it was working to keep Idahoans healthy and whether it truly gave Idahoans more access to care. In her answers to several questions, Charron said she would follow up with more information — as the committees will continue to debate the expansion during this legislative session.

The largest bucket of costs for Idaho Medicaid, and for the expansion group alone, has been pharmacy. That includes diabetes care, psoriasis and psychiatric medications, seizure drugs and cancer treatments. As Health and Welfare Director Dave Jeppesen explained to the Legislature's appropriations panel last week, that is mainly because of new higher-cost drugs.