Change is in the wind. By executive order earlier this year, Governor John Bel Edwards indicated his intent to expand Louisiana’s Medicaid program by July 1, 2016. By best estimates, as many as 400,000 adults, many who are gainfully employed, but currently uninsured, would be eligible for Medicaid. Currently, adult single men and women under age 65 who make more than approximately $2,300 annually are not eligible for Medicaid because they make more than 19% of Federal Poverty Level (FPL). Under expanded Medicaid, those individuals can earn up to approx. $16,000 annually and still be eligible for coverage under the expanded Medicaid program (increased from 19% to 138% of FPL). Currently for every dollar spent on Medicaid services in the state, Louisiana pays 38 cents and the federal government pays 62 cents. Under Medicaid expansion, the federal government pays 100% for new enrollees through 2016; 95% in 2017; 94% in 2018; 93% in 2019 and 90% in 2020 and thereafter. With Medicaid expansion, estimates are that Louisiana will receive an additional $1.8 billion per year from the federal government in federal health care funds and that 70% of those individuals who become eligible will be employed. With better access to care and more regular, consistent medical care, many also anticipate fewer visits to the emergency rooms around the state, and a resultant cost savings as emergency room care is one of the most expensive ways to receive care in the system.
There are additional costs. For example, The Louisiana Dept. of Health and Hospitals (DHH) estimates hiring 248 new employees to handle enrollment, at a cost of $10.3 million this budget year. A legislative hearing on this budget request was postponed in late February whereby $7.3 million would be paid by the feds and $3 million paid by health providers such as hospitals and clinics. The legislature must approve any such hiring plan and other future budget requests to implement the expansion. The legislative session beginning March 21st will determine if Gov. Edwards meets his July 1, 2016 implementation date.
R. Christopher (Chris) Martin is chair of the health law committee of NOBA and an attorney in the New Orleans office of Chaffe McCall, LLP. He can be reached at 504.585-7534 or Martin@chaffe.com