Idaho House approves Medicaid reform bill

BOISE — The House on Thursday advanced a bill that would make major changes to the way that Idaho administers its Medicaid program.

The chamber voted along party lines, 61-9, to pass House Bill 345 — which would require the Idaho Department of Health and Welfare to pursue a number of changes to the Medicaid program, including moving its administration to a third-party managed care organization (MCO) and implementing work requirements for the Medicaid expansion population.

Bill Sponsor Rep. Jordan Redman, R-Coeur d’Alene, said on the House floor Thursday that the bill was created to address some of the concerns over his previous Medicaid bill, HB 138, which would have triggered a full repeal of Medicaid expansion — a program approved via voter initiative in 2018.

“In many ways, I believe this is a broader bill that addresses the entire $5.2 billion Medicaid budget and creates very good savings and sustainability for our state,” Redman said.

There was limited debate on the floor, with Rep. Rod Furniss, R-Rigby, speaking in favor, especially in regards to the benefit to federally qualified community health centers, known as FQHCs.

Since 2022, much of Medicaid in Idaho has been overseen by physician-led valued-care organizations, or VCOs. These were designed to reward providers for cost savings and meeting certain health metrics but also claw back funding if those metrics weren’t met.

“The criteria was extremely onerous,” Furniss said, “and most of these health care centers were being clawed back, and some of them are going out of business.”

These health care centers serve Medicaid and Medicare patients and offer a sliding fee scale to under-served populations. The bill would exempt these FQHCs from financial risk in the value-based care agreements.

The move from the VCO to the private, third-party MCO, however, concerns some.

House Minority Leader Ilana Rubel, D-Boise, expressed concerns both in the committee hearing on the bill and on the floor that the added bureaucracy of working with these large organizations could impact access.

Another primary concern was around work requirements for those in the Medicaid expansion program.

The bill would require that able-bodied adults must work or volunteer at least 20 hours a week to continue to be eligible for coverage.

There would be exemptions for those younger than 19, older than 64, parents or caretakers responsible for children younger than 6, parents or caretakers caring for a dependent with a serious medical condition or disability, those receiving unemployment compensation, participating in a drug or alcohol treatment program, or attending college, university or vocational school at least part time.

Work requirements have received some of the most vocal pushback from the bill's opponents, who argue that it’s costly for the Department of Health and Welfare to oversee them and place a burden on Medicaid recipients.

Rubel noted that when Arkansas briefly implemented a work requirement – before it was halted by a court — it was found that about a quarter of its population was dis-enrolled, despite that around 95% of those dropped met the requirement.

“This is not about requiring people to work, it’s about requiring people to navigate very extensive paperwork proving it,” Rubel said, “and people run afoul of paperwork. When you have all these working people kicked off Medicaid, they turn up at hospitals, they have no insurance, we're right back where we were before Medicaid expansion.”

She also said the bill wouldn't provide an exemption for homeschooling parents who may not work out of the home but have children older than 6. 

The bill would require the Department of Health and Welfare to seek a change to require cost-sharing as a condition for participating in all of Medicaid — which can include monthly premium charges or co-payments — as well as increase the number of times eligibility is determined and end the practice of automatically re-enrolling people based on information the department already has through other public benefit programs, such as SNAP food assistance.

HB 345 will now go to the Senate, where the Medicaid expansion repeal bill, HB 138, also sits. 

Senate Health and Welfare Committee chair Julie VanOrden, R-Pingree, is a co-sponsor on HB 345. As chairwoman, she has discretion on what bills to bring up for a hearing. She previously told the Idaho Press that HB 138 is "still alive," but that she would like to see where the new bill goes. 

Last week, Sen. Glenneda Zuiderveld, R-Twin Falls, unsuccessfully tried to schedule HB 138 for a hearing while VanOrden was absent, the Idaho Press reported. Her motion was ruled out of order, but Zuiderveld wrote in her blog on Substack that she planned make a motion on the full to pull the bill out from committee for consideration by the full Senate. 

Medicaid by the numbers 

As of October, there were 294,664 Idahoans enrolled in all of Medicaid, and as of February there are around 83,000 people enrolled through expansion.

The total Medicaid budget, including federal funds, sits at nearly $5.3 billion — the state’s general fund share would be around $996 million for the upcoming fiscal year, based on the governor’s recommended budget.

The Medicaid expansion portion of the budget is about $1.4 billion in both state and federal funds, with the federal government covering 90% and the state covering the remaining 10%.

In total, Idaho Medicaid would, in fiscal year 2026, pay an average of $1,185 per member per month across its different programs, including both state and federal funds. Medicaid expansion participants cost about $1,080.74 per month in total.