Thursday, September 26, 2013

Michigan's Approach to Medicaid Expansion and Reform — NEJM

by John Z. Ayanian, M.D., M.P.P.
By linking Michigan's Medicaid expansion to market-oriented changes in this federal–state program, the governor and legislature have created a pragmatic pathway to link Republican and Democratic priorities for health care. The key Democratic goal of expanding Medicaid coverage to low-income adults will be implemented in tandem with Republican objectives to control the state's health care costs, increase the role of private health plans, and require some new Medicaid enrollees to contribute toward the costs of their care. In recent years the U.S. Congress has rarely been able to achieve bipartisan agreement on health care or other major issues. Thus, the best prospects for achieving greater efficiency and equity in health care may arise from states such as Michigan that can blend public and private approaches to health care reform, with bipartisan support.

Expands Medicaid to cover adults with incomes up to 133% of federal poverty level beginning in April 2014  . 
Authorizes Michigan to withdraw from the Medicaid expansion if new state Medicaid costs in 2017 and later years are not offset by other related savings in the state budget.
Introduces cost sharing amounting to up to 5% of annual income for new enrollees with incomes of 100% to 133% of the federal poverty level and allows reduced cost sharing for enrollees who engage in healthy behaviors.
Enrolls newly covered adults in private managed-care plans, with health savings accounts funded by enrollees or their employers to cover cost sharing.
Requires new Medicaid enrollees to have access to primary care and preventive services and be offered the option of completing advance directives for end-of-life care.
Authorizes the Department of Community Health to identify innovations in Medicaid that improve the quality of care, reduce its costs, or both.

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