Medicaid expansion still uncertain for Colorado

Kristen Wyatt
The Associated Press
Aspen, CO Colorado

DENVER – Colorado health officials won’t commit to increasing Medicaid coverage as called for by President Barack Obama’s federal health care law, saying it’s too soon to know whether the state can afford to expand health care for the needy.

Speaking to a group of health care activists, Roxane White, chief of staff to Democratic Gov. John Hickenlooper, said Wednesday the administration is waiting until after a December tax estimate before deciding how to proceed.

“Let me tell you now, we don’t have answers for you,” White said.

Under the law, Medicaid will be expanded to cover individuals who earn about $15,400 or less each year, which is 138 percent of the federal poverty line. Current income limits in Colorado depend on several factors, but can be as low as about $1,100 a year.

The change would add about 225,000 people to the state’s Medicaid rolls, which currently cover about 620,000 people.

Some states have already said they can’t afford to expand Medicaid. There’s no penalty for states that don’t make the change, although they would not receive federal funds that would cover the initial expansion.

The Medicaid overhaul is one of the two main ways the federal health law expands coverage to most of the 50 million uninsured U.S. residents.

As a broader Medicaid safety net picks up more low-income people, new health insurance markets, called exchanges, will offer subsidized private coverage to the middle class.

Both parts of the strategy take effect in 2014, at the same time that most Americans will be required to carry health insurance or pay a fine.

A national report out this week said Colorado may have to spend $858 million over the next 10 years on the Medicaid expansion. Nationally, growing the program to cover about 20 million more low-income people will cost over $1 trillion nationally from 2013 to 2022, said the joint report from the Kaiser Family Foundation and the Urban Institute. The analysis, however, found that states could pay $76 billion of that.

White disputed the $858 million projection, but the administration has not offered its own. White told the health care activists gathered at a daylong summit organized by the Colorado Consumer Health Initiative that state officials need to know tax projections and plans to contain costs before suggesting a Medicaid expansion.

White suggested that a big question for Colorado will be not whether it can afford to expand Medicaid for a year – but for many years. Under the law, the federal government pays all of the Medicaid expansion cost for the first three years, gradually phasing down to 90 percent of costs thereafter.

White said Colorado will resist expansion if it can’t be sustained. “That is not a place we can go,” she said.

Democratic Sen. Pat Steadman, who will lead the state budget-writing committee next year, compared Medicaid expansion to window shopping at a jewelry store where the gems are 90 percent off, but still unaffordable.

“Wow, that’s a great sale. I wish I could afford to buy it,” Steadman said.

Steadman called for patience by the health activists, many of whom are hoping Obama’s re-election and new Democratic control of both chambers of the state Legislature will smooth the way to insure more people.

Steadman cautioned that minority Republicans in the state still wield power and that lawmakers from both parties disagree on how to expand health care without spending too much.

“Health care seems to be one of those really polarizing issues,” Steadman said, adding, “folks just want to throw up roadblocks.”

Officials and activists agreed that Colorado has saved some heartburn going forward with implementing the health law by setting up a private health insurance exchange. Colorado was one of 17 states that have already started such work. The law requires exchanges, but many states held off as a failed legal challenge was resolved.