Michigan Becomes 25th State To Expand Medicaid. What’s Next?

Sep 16, 2013

Michigan is now the 25th state to expand Medicaid under the federal Affordable Care Act.

Suzanne Murphy of Ann Arbor hopes to become one of more than 320,000 newly-eligible Michigan residents to sign up for Medicaid next year.
Credit Jake Neher MPRN

Governor Rick Snyder signed the bill into law Monday.

But as The Michigan Public Radio Network's Jake Neher reports, the state still has a lot of work ahead to make sure the program is a success.

It took the better part of a year and a number of near-implosions in the state Legislature to get the expansion to Governor Snyder’s desk. But in the end, the governor got his wish to extend Medicaid benefits to hundreds of thousands of low-income Michiganders.

Snyder: “There we go. We’re done!” [applause]

Well… maybe not “done” so much. The bill also includes a number of changes to the way the state administers the program. That means it will have to be approved by the federal government.

The Snyder administration will also have to implement the program, which will include making sure people like Suzanne Murphy of Ann Arbor sign up.

Murphy – who has diabetes - recently lost her health coverage along with her job at the University of Michigan Health System. She’ll be starting a part-time job soon. She says it scares her to think what would happen to her health if lawmakers chose not to expand Medicaid.

Murphy: “I mean, because of the medications that I take, I would be very, very sick, and possibly hospitalized,” she says.

Supporters say situations like that are why the expansion is so important. They say sick people without insurance are often forced to get their health care from emergency rooms, and aren’t able to pay those bills. Governor Snyder’s administration says the measure will save health care providers millions of dollars in unpaid care every year. In turn, officials say costs will go down for everyone.

But it took a lot of convincing in the state Legislature to get enough Republicans on board with a key tenant of Obamacare. They added a number of provisions that change Michigan’s Medicaid system.

First, it includes incentives for healthier lifestyles.

State Department of Community Health Director Jim Haveman says the bill requires people like Murphy to see a physician within 60 days.

Haveman: “And after six months or so the physician sees that they are participating, that they’re making a difference in their life, they can reduce the premiums,” he says.

Republicans also wanted to make sure Michigan taxpayers won’t be on the hook for the expansion. The federal government has promised to foot the entire bill for the expansion for the first three years. After that, it promises the state will only have to contribute up to ten percent of the total cost.

But Republican state Representative Mike Shirkey says the bill requires the state to save enough money through the program to offset those future costs.

Shirkey: “When the federal government does start to reduce the funding subsidy, if the savings aren’t there to cover it, it stops. No legislative action required – it stops,” he says.

And the measure also gives new Medicaid recipients reasons to get off the program after four years. At that time, able-bodied adults in the expanded population will have to contribute more money out-of-pocket toward their health care. Or they can chose to buy private insurance on the federal health insurance exchange.

The state will have some extra time to implement the changes and get the plan approved by Washington. Supporters originally wanted the expansion to take effect on January 1st. But because of a legislative roadblock in the state Senate, it probably won’t happen until March or April of next year.

Back in Ann Arbor, Suzanne Murphy says she’s glad she thought to stock up on her medications before she lost her job. If she hadn’t, Murphy says she wouldn’t be able to wait until spring to buy them again.

Murphy: “So literally it could be and death for some people to wait just a few months,” she says.

In the meantime, state officials say Michigan could lose up to seven million dollars in federal funding every day the expansion is delayed after January 1st.

For the Michigan Public Radio Network, I’m Jake Neher.