Gov. Matt Bevin
Gov. Matt Bevin

Gov. Matt Bevin on Wednesday submitted his Section 1115 Medicaid waiver plan, which — if approved by the U.S. Department of Health and Human Services — would transform Kentucky’s Medicaid expansion enacted by former Gov. Steve Beshear.

Under the waiver proposal dubbed Kentucky HEALTH and first unveiled in June, individuals with income up to 138 percent of the federal poverty rate would still be eligible for expanded Medicaid, though “able-bodied” persons would have to pay a monthly premium to maintain coverage and could be locked out from coverage if payments are missed. Such individuals also would no longer be automatically eligible for benefits such as vision and dental, having to earn credits in their My Rewards Account by having health risk assessments, volunteering, taking smoking cessation classes, having a job or being in school.

Bevin reiterated in a press release announcing the submission of the 87-page waiver on Wednesday that his plan would lead to better health outcomes, ensure the long-term sustainability of the state’s Medicaid program — as Kentucky must begin to kick in a small percentage of costs for covering the expanded population next year — and “familiarize members with commercial insurance and prepare them for self-sufficiency.”

“The submission of this waiver is the result of many months of extensive research, planning and time spent traveling the state listening to Kentuckians,” said Bevin in his press release. “Kentucky HEALTH will allow us to continue to provide expanded Medicaid coverage, but unlike the current Medicaid expansion under Obamacare, it will do so in a fiscally responsible manner that ensures better health outcomes for recipients.”

The state’s Cabinet for Health and Family Services held three meetings to receive public comments on the plan in the weeks after it was released, and received nearly 1,350 written comments. Wednesday’s press release highlighted several small changes that were included in the waiver proposal submitted to HHS in response to those comments — though the main elements of the original Kentucky HEALTH plan remain in place. Those changes include:

  • Allergy testing and private duty nursing will continue to be covered by Medicaid.
  • The implementation of changes to dental and vision benefits will be delayed by three months to allow members additional time to accrue funds in their My Rewards Account to be eligible.
  • Individuals determined to be “medically frail” will not have to pay premiums and co-payments.
  • GED testing costs will be an additional Medicaid benefit.
  • The list of activities that add credits to a My Rewards Account now includes caretaking responsibilities, passing the GED and ensuring children receive preventative services like immunizations.
  • The sliding scale of required premiums for coverage will be collected on a household basis instead of on an individual basis.

The Center for Medicaid Services now has 15 days to acknowledge that Kentucky’s waiver was submitted correctly, which will then open up a 30-day federal public comment period on the proposal. When that period ends, HHS has the authority to approve the plan, though the agency has indicated the process can take up to seven months after the waiver application is submitted.

While Bevin’s proposal had received wide praise from Republican officials in Kentucky, health care advocacy groups have expressed concern that requiring premiums and locking people out of coverage for failure to make payments would serve as an obstacle to many low-income individuals and families gaining Medicaid insurance. HHS also has emphasized that states seeking a waiver to alter its Medicaid expansion may not limit access to coverage or benefits by conditioning eligibility on work or other activities, impose premiums or cost sharing at levels preventing low-income individuals from accessing coverage, or penalize people for needing Medicaid coverage for multiple years.

When unveiling his proposal in June, Bevin warned that if HHS does not approve the waiver, then “there will not be expanded Medicaid in the state of Kentucky,” an indication that he would either repeal the executive order of former Gov. Beshear to expand Medicaid — which resulted in over 400,000 people receiving coverage — or decline to reauthorize it next year. When asked what he would do if HHS only approved of 90 percent of Kentucky’s waiver proposal, Bevin said at the time that there is still a “negotiating process” going forward.

HHS press secretary Marjorie Connolly released the following statement after Gov. Bevin’s announcement, again praising the success of Kentucky’s Medicaid expansion over the past few years and indicating that the process going forward could still take considerable time.

“Kentucky’s Medicaid expansion has been very successful in improving health coverage, access to care, health outcomes, and financial security for its citizens,” said Connolly. “HHS has been clear that, as we begin the review of this application, we will assess it based on longstanding Medicaid principles of access to coverage and affordability of care. As in other states, we are prepared to continue dialogue for as long as it takes to find a solution that maintains and builds on Kentucky’s historic progress, and avoids moving backwards.”

Republican state Senators Julie Raque Adams of Louisville and Ralph Alvadaro of Winchester issued a joint statement praising Bevin’s proposal, arguing that Kentucky’s current Medicaid model is “broken” and the new waiver “provides a pathway to private insurance.”

“If we continue down this unsustainable path, many Kentuckians will lose their healthcare coverage and we will have less state dollars to fund education and fix pension systems,” stated Adams and Alvarado. “The waiver proposed by Governor Bevin is a common-sense approach to keep Kentuckians covered and become personally engaged in their own health. This waiver promotes accountability and provides a pathway to private insurance.”

Jason Bailey, the executive director of the progressive Kentucky Center for Economic Policy, said the waiver plan submitted by Bevin Wednesday is “fundamentally the same as the problematic proposal they released a few months ago,” as it “contains work requirements, lockout periods, premiums and other barriers that will reduce the number of Kentuckians getting coverage and move us backward on our nation-leading health progress. It continues to include measures that HHS has rejected in multiple other states for that reason.”

This story will be updated. 

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Joe Sonka
Joe Sonka is a staff writer at Insider Louisville focusing on government, politics, education and public safety. He is a former news editor and staff writer at LEO Weekly and has also freelanced for The Nation and ThinkProgress. He has won first place awards from the Louisville Metro chapter of the Society of Professional Journalists in the categories of Health Reporting, Enterprise Reporting, Government/Politics, Minority/Women’s Affairs Reporting, Continuing Coverage and Best Blog. Email him at [email protected]