Monthly premiums attached to health care coverage provided through Medicaid expansion would have little financial benefit for the state of Kansas and would eliminate 27,000 low-income adults from the program, according to the Kansas Health Institute.
The medical research nonprofit studied potential impact of $25 monthly fees that were attached to a Medicaid expansion plan the House passed earlier this session.
Previously, KHI predicted 130,000 Kansas adults and children would gain coverage through Medicaid expansion, with a yearly budget impact to the state of nearly $50 million. That figure doesn't include tax revenue from nearly $1 billion in annual federal funding that would flow through the state if expansion passes.
Rep. John Eplee, R-Atchison, introduced the premiums through an amendment on the House floor, securing votes from Republicans who were uneasy about embracing a welfare program. He thought the money from premiums would offset some of the cost of expansion but didn't realize 90 percent of proceeds would go to the federal government.
KHI estimates the fees would generate about $28.6 million in revenue for the 2020 calendar year. The state's portion would be $2.9 million before accounting for uncertain administrative costs.
However, the revenue estimate assumes all of the adults affected by expansion would enroll. Based on a review of states that have adopted premiums, KHI predicts 27,000 potential enrollees in Kansans would avoid signing up or get kicked off the rolls for failing to make payments.
"That would represent about 28 percent of KHI’s estimated 95,224 enrollees in the new expansion adult category," said Kari Bruffett, a policy executive for KHI. "The effect likely would be more pronounced among lower-income potential enrollees, as high as 50 percent in some research."
April Holman, executive director of the Alliance for a Healthy Kansas, which advocates for passage of Medicaid expansion, said the organization won't support policy that limits the ability to participate in KanCare, as Medicaid is known in Kansas.
"Experience in other states shows that charging Medicaid premiums to low-wage working people creates a barrier to participation," Holman said. "In the case of House Bill 2066, it would appear that the only benefit of imposing a premium would be to raise a relatively small amount of revenue."
Eplee, a family physician, said he was concerned by the KHI data but insisted premiums were necessary to ensure passage of a Medicaid expansion plan. He prefers the premiums to work requirements that have complicated expansion in other states.
"Anything that gives the recipients some buy-in, even if it is modest or minor, I think is important because they'll value the product more," Eplee said.
Eplee said he was willing to reconsider a lifetime ban he included with the amendment as punishment for repeatedly missing a series of payments.
Rep. Cindy Holscher, an Olathe Democrat, said many lawmakers were unaware of the lifetime ban when they voted on the package after a whirlwind series of procedural stunts.
"The biggest concern is to get it passed," Holscher said. "We've been in situations before where something like this needs to be addressed — maybe we get the bulk of the plan through and address (premiums) next year. It's obviously not where we want it, but getting Medicaid expansion is the most important priority."
GOP leadership has blocked advancement of Medicaid expansion, even though a majority of lawmakers in both chambers support expansion. Holscher announced last week she will run for the seat held by Senate Majority Leader Jim Denning, an Overland Park Republican, because of his opposition to Medicaid expansion.
On Wednesday, the Senate rejected an attempt to consider the expansion plan passed by the House. However, expansion supporters are prepared to hold an appropriations bill hostage and are considering other maneuvers to force a vote on a new deal.