New plan would use Medicaid $$ for private insurance in Nebraska

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January 14, 2014 - 5:20pm

Federal Medicaid dollars would help low income Nebraskans pay for private health insurance under a proposal introduced in the Legislature Tuesday.

It is the second time lawmakers have attempted to expand Medicaid in Nebraska. Last year the proposal was strictly to expand the government health care program to cover low income Nebraskans. This year’s proposal -- dubbed Wellness In Nebraska or WIN -- would use some of the federal dollars made available under the Affordable Care Act to help pay for private insurance.

Lincoln Senator Kathy Campbell said the changes respond to suggestions that the state needs its own plan. She described the proposal “a Nebraska plan that would maximize 100 percent of the federal funding, strengthen the private marketplace for all, support employer insurance participants, (and) reform Medicaid health delivery.”

Campbell also made a moral argument. “We cannot afford to leave Nebraska folks behind as our country continues reforming health care. To say ‘We have health care, but there is no space or time for you’ is unconscionable,” she declared.

The plan would cover people with income up to the federal poverty line, about $19,500 for a family of three, with a Medicaid managed care plan. But for those earning up to 138 percent of poverty – about $26,000 for a family of three -- the plan would use Medicaid dollars to pay for coverage via the federal health exchange, or by paying the employee share for people who have insurance through their work. People would still have to pay up to 2 percent of their income for coverage. But those fees would be waived if they participated in wellness activities, like having an annual physical, getting a risk assessment, and signing up with a primary care physician.

Asked if the changes would be enough to overcome the filibuster against Medicaid expansion last year, Campbell said she expected extensive debate, but that her colleagues would have an open mind.

Sen. Jim Smith of Papillion, who opposed Medicaid expansion last year, said he still has doubts. “I’ll certainly take a close look at what they are recommending and proposing, but I continue to have concerns in three areas,” Smith said. “The arbitrary point at which we define poverty and include more into the Medicaid program; the long-term cost to Nebraskans; and also just the burden of having more entries into a burdened market already.”

Supporters say it is foolish for Nebraska to forego hundreds of millions of dollars a year from the federal government, which will pay all of the cost for the first two years.

Critics, including Gov. Dave Heineman, have said the state’s eventual 10 percent cost share will divert tax dollars from other programs, like education. A spokeswoman for the governor had no immediate comment on the plan introduced Tuesday.

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