Why Utah’s Partial Medicaid Expansion Should Not Be A Model for Kansas

By Sheldon Weisgrau | July 15, 2019

Over the course of the decade-long effort to expand Medicaid in Kansas, opponents have grasped at a number of gimmicks that impose barriers to providing health coverage to as many as 150,000 hardworking Kansans.

The latest gimmick comes from the state of Utah, which recently received federal approval to implement a partial expansion of Medicaid (the fact that this plan overrides a public referendum supporting full expansion and thus undermines the will of Utah voters is another story). Rather than expand coverage to 138% of the federal poverty level (FPL) – $17,236 for an individual and $29,435 for a family of three – as required by federal law, the Utah plan expands coverage only to 100% FPL – $12,490 for an individual and $21,330 for a family of three.

The Utah model thus becomes the latest plan embraced by opponents as a viable alternative to expansion. Except it may not be viable.

One of the big carrots to encourage states to expand Medicaid is extremely favorable federal financing. Currently, the federal government pays 50% to 75% of Medicaid costs, depending on the state (here in Kansas, the federal government picks up 55% of the cost of the program, with the state contributing the other 45%). Under expansion, the federal government pays 90%. But federal law is clear – to receive the 90% match, a state must expand Medicaid eligibility to 138% FPL.

The full expansion to 138% FPL embraced by Utah voters would have covered about 150,000 people and received federal matching funds of 90%. The partial expansion will cover 90,000 people and receive Utah’s standard federal match rate of 68%, with the state covering the other 32%.

As a result, Utah’s partial expansion will cover fewer people and cost more money. It has been likened by one analyst to “paying $30 for a $10 movie ticket.”

Utah has requested that the federal government waive the requirement to implement full expansion to receive the 90% match. It’s not at all clear, however, that this provision can be waived. The Trump administration has already rejected requests by Arkansas and Massachusetts to receive the enhanced federal match for partial Medicaid expansions.

Utah’s plan also includes work requirements, another trendy idea supported by those who seek to limit coverage. A federal judge, however, has already overturned similar requirements in Kentucky and Arkansas, ruling that they are contrary to the primary purpose of the Medicaid program, which is to provide medical assistance to low-income families.

The Utah plan includes other questionable provisions – such as limits on enrollment and per capita caps on spending – that have never before been approved and are also likely headed to court.

The moral is that Kansas policymakers should steer clear of gimmicks like the Utah model, which may seem attractive, but in reality cost more, cover fewer people and will induce costly litigation.

There’s a simple way to avoid these problems, provide tens of thousands of Kansans with health coverage, bring back hundreds of millions of our federal tax dollars each year and support our rural health providers: expand KanCare to 138% FPL and forgo the gimmicks.

Sheldon Weisgrau is the Alliance for a Healthy Kansas’ Senior Policy Adviser. Contact Sheldon at sheldon@expandkancare.com.