Medicaid expansion in Michigan undecided

Legislative leaders have yet to decide whether to expand insurance benefits to a broader category of Michigan residents.

Medicaid provides health care coverage to the neediest American citizens. On June 28, 2012 the Supreme Court ruled that the federal government could not force states to expand Medicaid by threatening to pull back federal dollars meant to support existing Medicaid programs. States will now decide for themselves whether or not to expand Medicaid to cover additional residents.

In Michigan the decision whether or not to expand coverage to additional low income residents has not yet been made by Governor Snyder and the legislature. The expansion would include an additional 500,000 uninsured individuals gaining access to insurance beginning January 1, 2014. The concern is that the cost, while initially covered almost entirely by the federal government, will create a financial burden on the state in the future.

More than 2 million individuals are enrolled in Medicaid in Michigan. Children make up more than half of the enrollees in the state at 55 percent. Adults, the disabled and the aged comprise the rest. Twenty percent of the state’s population makes up the Medicaid rolls, which is the same percentage nationally. Michigan ranks eighth behind California, New York, Texas, Florida, Illinois, Pennsylvania and Ohio in the percent of the population receiving Medicaid.

Medicaid eligibility is based on the federal poverty level (FPL). The 2012 FPL for an individual is $15,415 and for a family of three it is $26,344. The minimum percentage of the FPL for pregnant women and children set by the federal government is 133 percent. For example, a pregnant woman in a family of three could have an income of $29, 848 ($3,504 above the FPL) and still qualify for Medicaid.

In January of this year, Michigan became one of 39 states that expanded the eligibility for pregnant women to 185 percent of FPL. According to the Kaiser Commission, in 2014 states may opt to move pregnant women with incomes above 133 percent FPL from Medicaid to Exchange coverage.

Medicaid provides a safety net for children experiencing poverty in Michigan. As of January 2012 children’s eligibility for Medicaid is based on 150 percent to 200 percent of the federal poverty level. Parents and non-disabled adults without children do not fare as well. Their federal poverty level percentages are much lower, and the state is no longer accepting applications from parents and non-disabled adults.

Under the Affordable Care Act, the state can cover all of its low-income citizens through Medicaid at 133 percent FPL beginning in 2014. Whether Michigan’s decision makers choose to do that, and how broadly they extend coverage, remains to be seen.