POLITICS
12/10/2013 03:21 pm ET | Updated Dec 11, 2013

Iowa Medicaid Expansion Plan Gets Federal OK

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The U.S. Department of Health and Human Services gave Iowa Gov. Terry Branstad (R) the go-ahead Tuesday to expand Medicaid in his state under President Barack Obama's health care reform law.

Iowa is among the 25 states and the District of Columbia that, beginning in 2014, will open the low-income health care program to any resident who earns up to 133 percent of the federal poverty level, which is currently about $15,300 for a single person. Branstad is one of just 10 Republican governors who have supported the Medicaid expansion. The Washington Post first reported on the approval of Iowa's plan Tuesday.

Iowa had proposed to provide private health insurance coverage to newly eligible Medicaid beneficiaries, including enrolling some into plans available on the health insurance exchange created by the Affordable Care Act, and to charge them monthly premiums for their benefits. Federal authorities agreed only partly to this plan and will permit Iowa to demand premiums only from people with earnings over the poverty level. More than 100,000 additional uninsured, low-income Iowans will be eligible for Medicaid benefits, according to the Center on Budget and Policy Priorities.

“Iowa has pioneered innovative, state-based solutions for Medicaid expansion, and we are pleased to grant this waiver,” Marilyn Tavenner, administrator of the federal Centers for Medicare and Medicaid Services, said in a press release. "CMS stands ready to work with other states to explore options that aim to improve care and lower costs in the Medicaid program.”

The Iowa Department of Human Services referred The Huffington Post to Branstad's office, which wasn't immediately available to comment.

Most GOP governors and state legislators refused to expand Medicaid after the Supreme Court ruled last year that it was optional for states. More than 3 million poor people will remain uninsured in those states as a result, according to the consulting firm Avalere Health. The Urban Institute estimates those states also will forgo billions of dollars in federal funding. The Affordable Care Act provides tax credits to cut the cost of private health insurance for those who earn above the poverty level, but because of the high court's ruling, individuals with incomes below poverty won't qualify for any financial assistance in states that don't expand Medicaid.

Iowa will become the third state to adopt a partially privatized version of the Medicaid expansion, following a model used by Arkansas Gov. Mike Beebe (D) and GOP lawmakers in his state and Michigan Gov. Rick Snyder (R) and his majority-Republican state legislature. Pennsylvania Gov. Tom Corbett (R) and Tennessee Gov. Bill Haslam (R) are still negotiating with the Obama administration over their Medicaid reform and expansion plans.

Branstad rejected the Medicaid expansion in 2012 but reversed his position earlier this year. The Republican-led Iowa House passed the Medicaid bill in May, following the majority-Democratic Senate.

The urgency of securing federal approval for Iowa's Medicaid plan was intensified by the need to preserve health coverage for tens of thousands of residents currently enrolled in a more limited program called IowaCare, which expires Dec. 31, the Des Moines Register reported. Those beneficiaries are supposed to transition to Medicaid next year.

The Affordable Care Act allows states to extend Medicaid with full federal funding for newly eligible individuals from 2014 to 2016, after which the share gradually diminishes to 90 percent in 2022 and beyond. For current Medicaid beneficiaries, the federal government pays an average 57 percent of the cost, with states paying the remainder.

Nearly 1.5 million people have been determined eligible for Medicaid or the Children's Health Insurance Program, a related benefit, since the beginning of the Obamacare enrollment period on Oct. 1, the Department of Health and Human Services reported last week.

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