Medicaid: State takes first step toward implementing work rules passed by Legislature

Medicaid expansion covers those earning up to 138 percent of the federal poverty level, or $17,236 for an individual and $29,435 for a family of three.

Wednesday's hearing is in Billings, from 11:30 a.m. to 1:30 p.m. at Billings Clinic in the conference center, 2800 10th Ave. North. Helena is the location for the Thursday hearing, from 11 a.m. to 1 p.m. at the Sanders Auditorium, 111 N. Sanders.

People can also participate in either hearing via a webinar. Information to register can be found at https://dphhs.mt.gov/medicaidexpext.

In the application, and as laid out in the law that passed in April, people who are not exempt for work requirements must participate in 80 hours a month of work or other activities. The waiver application said those activities can include, besides employment, things like workforce training, education, substance abuse treatment, volunteering and community service, or other activities that promote "work readiness."

People can be exempt from work requirements for a variety of reasons, from being medically frail to pregnancy, or serving as a foster parent or caregiver, being enrolled in school or living in an area designated as high-poverty, such as an Indian reservation, and more.

The application says the state will use existing data sources to identify people meeting the work requirements or who are exempt. There will also be ways to report hours worked or exemptions online, through a call center, by mail or in person.

While the waiver process is important, most of the hammering out how the work requirements under Medicaid expansion will be implemented happen later — in administrative rules to be written by the relevant state agencies, most importantly the health department.

“A lot of the details are really going to be in the implementation and rule-making process,” said Heather O’Loughlin, the co-director of the Montana Budget and Policy Center, which has closely tracked expansion since it first passed in 2015.

The rule-making, which will set up how different agencies in state government can share information needed to verify work hours, exemptions and more, can’t really get started until after CMS approves the state’s waiver so the state is clear on it’s approved to do.

Other states that implemented work requirements have faced challenges with the ways people document their hours. In Arkansas, more than 12,000 lost coverage in the first six months, in part because of problems reporting. People were originally supposed to use a website, but it was only available from 7 a.m. to 9 p.m., and Arkansas, like Montana, does not have coverage to reliable internet access statewide.

That's why so much of the focus in Montana's pending program focuses on the state using information it already collects to verify hours worked or exemptions. That comes in the administrative rules, which will go through their own public comment process.

"A key part of this is it places a heavy load on the state in terms of implementation," said Aaron Wernham, president and CEO of the Montana Healthcare Foundation. "Identifying everyone who is going to be exempt by law is going to be a very heavy lift. It's knitting a lot of data streams."

The waiver application acknowledges that, and doesn't give specific implementation dates for work requirements, citing the complexity of getting the program off the ground.

" ... Initiatives under this application require large and complex business process development, infrastructure planning and deployment, and information systems modifications," the application reads. "Montana is also cognizant of reporting from states with similar work/community engagement requirements that suggest loss of coverage may result form inadequate systems or a lack of consumer information."

The application says Montana wants to implement the work requirements only once the infrastructure is fully in pace to help promote a continuity of coverage and minimize confusion and complexity for people on the program.

Bob Olsen, senior vice president of the Montana Hospital Association, said his group is already looking ahead to the rule-making process.

“The real granular level, which is not a part of the waiver request, that’s what is going to be the key,” Olsen said. “How do they adopt administrative rules so that an average person can understand them? If they do a good job, we’ll avoid the dis-enrollment issue other states have faced.

"But it’s in how the state carries those policies forward, all the way from educating consumers who are subject to the policy and those who are exempt. What we’ve seen in other states is that consumer communication did not prove adequate. People were being taken off their coverage not because they weren’t working or otherwise engaged, but that they didn’t realize they had to report it or didn’t know how."

It will be vital, Olsen said, for people who are either covered on Medicaid expansion or advocates for the program to start speaking up in the application hearings this week so that the health department learns about any types of situations it needs to consider when writing rules.

“The more you get into ‘Here’s my circumstance, how does this work for me?’ I think will be helpful for the department to say, ‘I hadn’t thought of that,’” Olsen said. “People who are on the program should come and say, ‘Here’s my circumstance, how does this affect me?’ Those are the kind of granular questions I think people should ask for the department to chew on."

On Friday the governor's office said it's already working on how multiple agencies will work together to share data.

"The governor's office is focused on working closely with state agencies to ensure that the process of setting up the Medicaid expansion system is efficient and accurate. Our priority is to eliminate paperwork traps or costly bureaucratic barriers so that as many Montanans as possible can continue to receive access to life-saving preventative care," said communications director Marissa Perry. Agencies will include the Department of Revenue, Department of Health and Human Services and Department of Labor and Industry.

The application mirrors a fiscal note attached to the bill that estimates about 4,000 will lose coverage under work requirements.

“We know that there will be some loss of coverage once these requirements go into place,” O’Loughlin said. “We know that most Medicaid expansion enrollees are already working, so a lot of this will be based on what the system looks like.”

The new waiver application also includes an increase in premiums for people who have been on the program longer than two years. State data shows that some people on the existing program have lost coverage because of an inability to make premium payments.

Data included in the application showed that out of 100,112 enrolled over the month of January, nearly 11,267 people were within the grace period for unpaid premiums. Of that, 2,646 had fallen three months or more behind.

“There are a lot of folks who struggle to afford those premiums,” O’Loughlin said. Because premiums won’t increase until someone has been on the program more than two years, the change won’t be felt as quickly as the work requirements will once implemented.

The waiver application also seeks to continue another piece of Montana’s program that sets it apart from others, a continuous 12-month eligibility. That’s an important part of making sure people can access the program in Montana, O'Loughlin said.

“When you’re determined to be eligible, you maintain your health care coverage for a 12-month period rather than the department having to go back and more frequently check eligibility,” O’Loughlin said. “It also reduces some of the administrative burden, but also ensures if somebody has extra hours in a certain pay period that aren’t regular wages that they wouldn’t lose coverage automatically.”

This provision in Montanan’s plan does not mean the state does not do eligibility verification.

O'Loughlin said it's important for beneficiaries to understand the existing program will remain, without work requirements, until the process of administrative rules is finalized.

"The big message for folks to know is that Medicaid expansion in its current form will continue, that coverage for those who are currently eligible will continue during the process of submitting a new waiver," O'Loughlin said.