Legislators jockey for market-based plan

In late February, Missouri House committees rejected a Democratic proposal to adopt the Medicaid expansion, and Republicans pushed a market-based plan for Medicaid.

Rep. Jay Barnes, R-Jefferson City, said his bill would offset some of the hospitals’ disproportionate share hospital payment losses from Medicaid, administered by the states.

The bill would not address shortfalls from Medicare cuts specified in the federal Affordable Care Act and the sequestration because states have no control over Medicare, he said.

The Republican bill would introduce price competition among private insurers seeking Medicaid patients, Barnes said, and participants would receive cash incentives to choose affordable care options. The plan also would increase cost sharing to the extent allowed by federal law so that participants would have some out-of-pocket expenses.

“We do this so that Medicaid participants will have the same market incentives that every other Missourian has when they’re choosing how to spend their own money on health care,” Barnes said. “We give them skin to put in the game.”

Missouri Hospital Association spokesman Dave Dillon concurred that the measure would offset some disproportionate share hospital losses, however, he said by limiting coverage to families earning 100 percent of the poverty level – $23,050 for a family of four – the bill would enroll fewer participants in Medicaid than the ACA, which has a threshold of 138 percent of poverty level, or $31,809. As more uninsured people are enrolled in Medicaid, the need for disproportionate share hospital funding declines, he said.

“From our perspective, the fact that we’re continuing to have a conversation, that Rep. Barnes put a bill in on it, is good,” Dillon said. “That is a step forward, because the legislature at the beginning of this session seemed unlikely to tackle this issue. Is it exactly what we want? Probably not.”