Despite reservations, Senate Health and Welfare recommends Medicaid expansion stay

BOISE — The Senate Health and Welfare Committee is recommending Idaho keep Medicaid expansion in place, but like the House health committee, it has reservations about its costs.

Idaho voters in 2018 approved Medicaid expansion, which provides coverage to adults who made too much to qualify for traditional Medicaid health coverage but not enough to qualify for subsidies on the state’s health care exchange. The program is up for its required five-year review, in which the House and Senate Health and Welfare committees could give recommendations for the future of the program; the House’s were submitted on Tuesday morning and the Senate’s were provided that evening.

“The committee has grave concerns about the cost sustainability of the current program, but they do realize that the outcomes of stopping it at this point would not be in the best interest of Idahoans,” the letter, drafted by committee Chair Rep. Julie VanOrden, R-Pingree, said.

Like the House committee’s recommendations, the letter states the program’s continuation should be re-evaluated by the Health and Welfare committees in 2025, and the Idaho Health and Welfare Department should give a report on the implementation of its requests in the 2024 legislative session.

For fiscal year 2024, the division of Medicaid is requesting around $67.4 million from the state general fund for the Medicaid expansion program; in fiscal year 2023, general fund spending on the program totaled around $68 million. Although state general fund expenditures are expected to decrease, federal and dedicated requests will increase from last year, Idaho Division of Medicaid Administrator Juliet Charron told the committee last week. Charron provided an overall update on the program to both the House and Senate Health and Welfare committees as part of the review, during which she said it’s expected there would be higher costs to the state if Medicaid expansion was not in place.

Costs in fiscal year 2023 were higher than expected, Charron said, in part because during the public health emergency the department was prohibited from removing participants from Medicaid in most situations. The department has tracked people enrolled in the program who are likely to now be ineligible, and started notifying these individuals Feb. 1. Staff anticipates there are around 67,000 participants who may fall into this category that could be removed from the program and that this redetermination process will take six months.

The letter directs the health department to complete this process “as quickly and efficiently as possible.”

It also emphasizes the focus on prevention through managed care.

The committee additionally recommended the department seek federal waivers to change how it implements the state’s health care exchange program, set up through the Affordable Care Act — specifically asking for waivers to add required employment and allow certain individuals the option of using the health exchange or Medicaid.

The last recommendation was to continue reviewing cost drivers and identify potential savings.

The agency is currently reviewing cost containment recommendations from a consultant hired through the Division of Financial management. The consultant produced a preliminary report in December and a final report is due in April. Some of the cost-saving measures the report recommends include reducing in-state pay-to-cost ratio of hospital reimbursement for inpatient stays and eliminating the adult dental benefit.

Senate Minority Leader Melissa Wintrow, D-Boise, said that Medicaid expansion “has been a great investment in our state,” and that it's saved the state money for covering the costs of uninsured patients. 

Charron said in her presentation an analysis of costs that would have been incurred had Medicaid expansion not been in place showed the state would have spent around $10 million more than with the program.

Leaders in both chambers now have the letters of recommendation, but House Health and Welfare Chairman John Vander Woude, R-Nampa, said it will likely take legislation to implement most of the ideas put forward in the letters.