State moves forward to carry out reforms

Washington state is moving ahead with plans to cover low- to moderate-income people following Thursday’s U.S. Supreme Court decision upholding federal health care reform.

State officials are working to put a health insurance exchange in place by October 2013. They also are bracing for an influx of as many as 500,000 new enrollees in the Medicaid health program for the poor in January 2014.

Democratic Gov. Chris Gregoire welcomed the certainty provided by the court’s ruling on the Affordable Care Act. She said it frees the state to continue reforms she has always contended were constitutional.

“We’ve tried to ready ourselves on all fronts,’’ Gregoire told reporters at a news conference, touting a recent $128 million award from the federal government to set up the new Washington Health Benefit Exchange and pay for its costs and insurance subsidies through 2014.

In her remarks, Gregoire touched on her family’s own brushes with cancer – hers in 2003 and her husband Mike’s recent diagnosis. Gregoire said families across the state can now be comforted in knowing they’ll be able to get health coverage too.

Coverage won’t happen overnight, though.

In the short term, state insurance commissioner Mike Kreidler says, the court ruling ensures that those already receiving benefits under the 2010 reform law can continue receiving them.

Those benefits include a prohibition against lifetime caps on insurance benefits for more than 2.4 million Washingtonians; the ability of 52,000 young adults to stay on their parents’ plans up to age 26; and the waiver of copays or deductible insurance costs for preventive care for more than 1.2 million people. Kreidler said another 60,000 Medicare enrollees are saving hundreds of dollars on drug prescriptions.

Longer term, some 800,000 of the state’s roughly 1.1 million uninsured residents could be covered starting in January 2014, Kreidler’s office said. Roughly 477,000 of them would receive subsidized care through the new health care exchange, envisioned as a marketplace where consumers can comparison shop for health insurance. Another 328,000 could be covered by a future expansion of Medicaid to include low-income adults who have no dependent children.

Gregoire said the Legislature needs to formally approve an expansion of Medicaid, but she sees no reason it won’t happen. That is because Medicaid costs for those who are newly eligible will be covered 100 percent by the federal government through 2016, and at least 90 percent after that.

Republican Attorney General Rob McKenna, who joined other Republicans attorneys general in challenging the federal law’s individual insurance requirement, speculated the state could face costs up to $250 million for expanding the Medicaid program after January 2014. That is because some people eligible for Medicaid today are not enrolled, and their costs will be split 50-50 between the state and federal governments if they enroll later – a big difference from the 100 percent federal coverage for people who become newly eligible due to reforms.

Doug Porter, director of the state Health Care Authority, said he did not know where McKenna came up with his $250 million cost figure. McKenna himself said he could not assure it was accurate. Porter said realistic estimates won’t be available until the state gets its next caseload forecast in November.

But Porter said McKenna is right in saying there could be a “welcome mat effect” in which people eligible for Medicaid today, but who are not enrolled, learn about the program and sign up after January 2014.

State Sen. Linda Parlette, R-Wenatchee, said costs for the state are a reason to rethink the expansion of the program.

“In its current form, the federal health-care law could bankrupt any state,” Parlette said in a news release. “We need to ask whether the policies our state is pursuing encourage affordable choices for health care insurance. The next question must be whether it pencils out from a budget standpoint because there’s no sense in making empty promises.”

Questions also remain about whether the state has enough primary care doctors to see the influx of patients. Gregoire said there are efforts to bring more doctors into practice through a collaboration of University of Washington and Washington State University at Spokane’s Riverpoint Campus.

Porter said the reform law also provides higher reimbursements for doctors who care for Medicaid patients in 2013 and 2014. After that, the state would have to decide if it wants to pick up the cost.

Gregoire’s administration also is seeking waivers from the federal Department of Health and Human Services to create a cheaper, more effective way of delivering care to poor people who are eligible for both Medicaid and Medicare.

Oregon recently won such a waiver, and Washington hopes to learn in July or October whether its two plans – one for managed care through insurers for urban areas, and the other for managed care through designated clinics in rural areas – will be accepted, Porter said.

Whatever the details, state officials expect greater success on this, their second major attempt to expand health care coverage. Gregoire noted that Justice Ruth Bader Ginsburg, in her concurrence of the majority ruling, cited an amicus brief filed on the Washington governor’s behalf that described the state’s failed attempt to reform health care in 1993.

“We went on our own, and we failed, because we didn’t have an individual mandate,” Gregoire said. “Without the individual mandate, we had a disaster in our state. We couldn’t go on our own. We needed national health care reform.”