Nearly two out of every three people signing up for health care coverage so far on Maryland's troubled insurance exchange qualified for Medicaid — helping the state top its goal for the program's enrollment.
Enrolling more lower-income residents in the state and federal insurance program has been embraced by state leaders as a success amid all the exchange's difficulties. Launched Oct. 1 to offer Maryland's uninsured access to coverage, the exchange has been plagued by problems that state officials only recently said they mostly fixed — days before the deadline to sign up for coverage starting with the new year.
The state has been expanding Medicaid coverage to more residents for years in an effort to reduce health care costs for all. Getting people into insurance is expected to help them better manage chronic conditions and to limit expensive visits to emergency rooms.
Maryland expects to save more money — perhaps nearly $2 billion over 10 years — because the Affordable Care Act pays all Medicaid expansion costs for three years and most costs for years after. Critics argue the expansion will boomerang eventually on states that embrace it because the federal government won't be able to sustain covering the added costs.
"It's unrealistic to think that the federal government will continue to pay such a large share," said Rep. Andy Harris, Maryland's lone Republican congressman
The law was designed to cover about half the nation's 40 million uninsured, and so far about two-thirds of the 1.2 million Americans buying coverage on exchanges qualify for the program because they earn less than 138 percent of the federal poverty level, or just over $15,000 annually.
In Maryland, officials said Thursday that after they weeded out duplicate applications, about 19,578 people officially were enrolled in Medicaid by the new year out of just over 31,000 who used the exchange to get insurance. Thousands more are in the process. Additionally, almost 92,000 more people have been moved to Medicaid from a bare-bones state program for adults.
With 111,148 people gaining new Medicaid cards, officials have beat their goal of enrolling 110,000 new people and believe that no more than 10 percent of those who qualify will be left without full benefits.
"By choosing to implement the Medicaid expansion under the Affordable Care Act, we are well on our way to providing quality comprehensive coverage to an additional 110,000 Marylanders while ensuring substantial savings to the state," said Lt. Gov. Anthony G. Brown, the governor's point person on health care.
The program's latest expansion comes on top of prior state efforts to boost it. Lawmakers in Annapolis, led by Gov. Martin O'Malley and Brown, have added about 400,000 people to Medicaid during the past seven years, using, for example, a cigarette tax in 2007 to cover more children and their parents.
That brought the total insured through Medicaid to almost 1 million — or about a sixth of the state's population.
On Tuesday, Maryland received a $43.4 million performance bonus from the U.S. Department of Health and Human Services for its success in expanding youth access to Medicaid and its Children's Health Insurance Program. The number of Maryland children enrolled in such coverage increased to more than 586,000 in October 2013 from around 407,000 in January 2007. The money can be used to provide insurance for more children.
While Maryland welcomed the recent Medicaid expansion, about half the states declined to expand their programs largely because of the potential long-term costs. States must pay half the costs of those already on Medicaid, and it's not clear how long the federal government will pick up the tab for the expansion.
Medicaid costs already account for nearly a quarter of state expenses, according to the National Association of State Budget Officers.
Regardless of the costs, the expanded coverage is being cheered by health care advocates and those getting coverage.
Vincent DeMarco, president of the advocacy group Maryland Citizens' Health Initiative, said he's heard about lives saved and improved from patients who already got coverage. And he hears from those relieved that they will soon be able to visit a doctor and fill prescriptions.
Cyrus Nusum of Baltimore has asthma and was counting down the days until her new Medicaid insurance kicked in.
Nusum qualified for the expanded program after being laid off from her job for a company that offered managed-care plans to Medicaid patients. She quickly landed a new job at a small medical clinic but was not offered health insurance immediately.
She was familiar with Medicaid and its expansion because of her line of work, so she enrolled herself and her college-age son.
"In my old job, my life revolved around helping people get the most out of their Medicaid benefits," Nusum said. "I saw a lot of people who would go to the emergency room for routine things. I don't want to be one of those people, because that strains the whole system."
She said she believes she will cost the medical system less by managing her chronic condition rather than racking up big emergency room bills.
Officials, too, expect long-term health savings from providing coverage to more people, said Chuck Milligan, a deputy state health secretary who runs the Medicaid program.
He cited an analysis by the Hilltop Institute at the University of Maryland, Baltimore County that found $672 million in net savings from implementing the Affordable Care Act in Maryland by 2020. The largest savings will come from moving more people to Medicaid from a state-funded health program for low-income adults.
All state residents will benefit, Milligan said, because hospitals will see cost savings from an expected reduction in uncompensated, or charity, care — expenses now passed on to everyone in higher hospital rates.
"A huge number of people are going to benefit from the expansion," he said. "It was a no-brainer. …It's a win for patients, for the state, for hospitals, for everyone."
A recent study by the Commonwealth Fund supports that view. It also found that states forgoing the Medicaid expansion not only will lose money to help cover their residents, but will pay for other states' expansions through higher taxes assessed to pay for the reform law.
An analysis by the conservative Heritage Foundation found that only 10 states, including Maryland, would see a substantial savings from Medicaid expansion by 2022. Forty other states would eventually pay more, losing a combined $37.9 billion.
Maryland, the group found, would see savings of $1.9 billion over 10 years. New York would achieve savings of $33.8 billion.
But, the analysis read, "The states will only save by shifting the burden to the federal government."
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That doesn't sit well with congressional Republicans, including Harris, who, with others, has introduced a bill to shift some of the financial responsibility back to the states.
"The Medicaid expansion is not without risk to the states," he said. "Once people are on Medicaid, it's mighty hard to take them off."
Harris also said adding so many people to the Medicaid system will put a strain on physicians. While he noted that Maryland lawmakers agreed to pay doctors more to provide services to Medicaid patients, the fees are only equal to Medicare payments and are not what physicians earn for treating patients with private insurance.
But the Maryland state medical society, MedChi, said more doctors plan to see Medicaid patients because of the increase. A recent MedChi survey of 251 Maryland physicians found that close to half of doctors who do not accept Medicaid are considering adding them, and more than half of doctors who already see Medicaid patients plan an increase.
There are up to 14,000 doctors actively practicing in Maryland, and about a third accept Medicaid.
"They're saying we can make it work," said Gene M. Ransom III, MedChi's CEO. "More people in Maryland are getting insurance, and now they'll have a doctor to go to."