ACA Medicaid expansion: Lien on me?

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N.B. 6/19: See second update at bottom: there is a bill in the New Jersey legislature, S3489/A5064, that would ended the pursuit of asset recovery for Medicaid enrollees who are not enrolled in long-term care.

I think it's fairly widely understood (at least by me) that Medicaid picks up the tab for long-term care only when the beneficiary has spent down her assets (if she had any), and that when the spouse of such a beneficiary passes the state can claim remaining assets, such as a house.

What I didn't know, and just learned via  New Jersey-based elder lawyer Lauren Marinaro, is that most states can recover assets from any Medicaid recipient over age 55 upon that person's death or the death of his spouse (or any children passing age 21 or blind or disabled). In most states, that's true whether or not the Medicaid enrollee obtained long-term care.

A 1993 federal law required states to recover assets from the estates of recipients of long-term care services under Medicaid. States also have the option of recovering for other Medicaid benefits obtained above age 55. As of 2014, 35 states and D.C. were recovering for other benefits.

The ACA Medicaid expansion complicated the picture. Pre-ACA, Medicaid eligibility generally included an asset test -- as it still does for Aged, Blind and Disabled (ABD) Medicaid. In states that have accepted the ACA expansion, however, Medicaid eligibility is extended to anyone* whose household income is below 139% of the Federal Poverty Level (FPL) -- or $17,236 for a single person in 2019.

There is no asset test for Medicaid eligibility under ACA expansion criteria.  But in many states (including New Jersey) anyone over age 55 who qualifies as an "expansion" enrollee (as well as any other Medicaid enrollee) is potentially subject to lien on assets and state recovery after death. In New Jersey, the tab would include total capitated premium paid to a Medicaid managed care organization (MCO) for enrollment in a managed Medicaid health plan. (A 2017 update to NJ asset recovery rules is here.)

What would it cost a state to offer something like Medicaid to all its uninsured?

At healthinsurance.org, I look back at a state-wide proposal to create what I've called an "all-public option" for the ACA -- that is, an exchange in which all the insurers operate like Medicaid managed care companies, paid directly  by government. Here I want to outline a few factors involved in funding such a plan.

Here's the basics from the healthinsurance.org post:

In November 2009, before the ACA was passed, a New York nonprofit, Community Service Society, produced a plan for the state that would have done just that -- and then some, as it would have given employers the option of buying in. (In 2013, CSS produced a plan outline and cost estimate for the state's BHP that did a good job scoping out the costs and target population as it actually played out, )

Authored by  Elisabeth Benjamin, CSS's VP of health initiatives, and Arianna Garza, the Cornerstone for Coverage Plan  would have used New York Child Health Plus plan (CHP), which was the prototype for the national Children's Health Insurance Program, as the building block of a low-cost public program available not only to the uninsured but to the underinsured. Here is the core proposition:

Hillary Clinton "waives through" the public option

[Update: more on "BHP for all," with New York as model, on healthinsurance.org, here.]

Hillary Clinton has updated her package of proposals for "building on" the Affordable Care Act, finding incremental ways to make coverage more affordable. The new proposals include this:

Continue to support a “public option”—and work to build on the Affordable Care Act to make it possible. As she did in her 2008 campaign health plan, and consistently since then, Hillary supports a “public option” to reduce costs and broaden the choices of insurance coverage for every American. To make immediate progress toward that goal, Hillary will work with interested governors, using current flexibility under the Affordable Care Act, to empower states to establish a public option choice.

Clinton is here suggesting that her HHS will support state initiatives to form their own public options. In a vague way, she references the ACA's Section 1332 "innovation waivers" enabling states to propose alternative schemes to the core ACA structure that would meet the ACA's coverage and affordability standards. The great advantage of this proposal -- as with Clinton's promise to ramp up healthcare antitrust enforcement -- is that it would not require legislation.

As Kaiser's Larry Levitt has pointed out to me, "Nothing in the ACA stands in the way of a state creating a public option." He further noted that a state would not need an innovation waiver to form one. It would, however, need funding, and that's where the waiver might come in. If the state could find other means of savings, those measures might be integrated in a waiver proposal with a public option.

Cheap and narrow Molina gains market share in Covered California

Yesterday, Covered California released some selected health insurers' sales data. The press release emphasized the fact that insurers that cut their prices in 2016 gained market share. 

As I've been tracking the offerings performance of Medicaid managed care providers (MCOs) that are selling on the ACA exchanges, I was interested in the snippets about Molina, an MCO that fields narrow networks on the exchanges and probably pays providers something close to Medicaid rates. Here's what CoveredCA had to say about Molina in CA in 2016:

Molina Healthcare lowered its rates for 2016 and ended up enrolling more than 50,000 new consumers during open enrollment, which, when added to the more than 37,000 who selected Molina in renewal, means it has more than 88,000 enrolled, the fifth-largest total statewide...

What if all the ACA "options" were "public"?

Consider these two facts about current U.S. health insurance markets.

First, as Bruce Japsen reports in Forbes:

Though the nation’s health insurance industry is having a tough time turning a profit selling individual policies on the public exchanges under the Affordable Care Act, the health law’s Medicaid expansion is churning big profits.