Idaho Gov. Otter wants more personal accountability in Medicaid

A plan in the works would add incentives.

adutton@idahostatesman.comMay 30, 2013 

Correction: This story has been updated with newer estimates of Medicaid enrollees next year.

Gov. Butch Otter wants to make it harder for people to benefit from Medicaid unless they make healthy choices. It's one of the options he's weighing as he ponders whether to add Idaho's poorest adults to the program.

A plan in the works by the Idaho Department of Health and Welfare carries the same theme - personal responsibility - but takes a different path.

During the last legislative session, Otter said he wouldn't support going along with the national expansion of Medicaid right away. That means Idahoans won't be eligible when the expansion kicks in next year and offers coverage to all adults up to 138 percent of the poverty line.

The state wouldn't pay more than 10 percent of the cost, but Otter demurred. He had assembled a Medicaid work group that ultimately recommended the expansion, but with caveats that Idaho's program needs tweaking.

"We have time to do this right, and there is broad agreement that the existing Medicaid program is broken," Otter said in his State of the State prepared remarks.

The program currently covers about 230,000 people and costs about $1.65 billion a year, and the federal government pays about 70 percent of the medical claims. An expansion would raise enrollment by roughly half. It would save Idaho taxpayers money that is currently spent on catastrophicmedical bills for the poor.

Otter told the Idaho Statesman's editorial board last week that he wants Medicaid to require more personal responsibility and better health outcomes.

"If you're smoking, you gotta quit smoking," he said. "And if you don't quit smoking, some part of the benefit, or all of it, goes away.

"If you've got a history of diabetes in your family, and you're told to change a certain lifestyle, and you don't do it, then you don't get (benefits) anymore."

He said those two things exemplify "what's wrong with the present Medicaid system."

People "don't have any responsibility or personal stake," he said. "It's not based upon success, it's actually based upon a failure."

A NEW MODEL

Otter isn't the first to demand such changes. Elected officials in states such as Maine and Michigan have pitched similar ideas. And his criticism echoes that of many in the health care industry. The dominant model for health care in the U.S. is "fee for service," which ends up paying more for medical emergencies than it does for prevention.

Idaho's Medicaid program is already shifting away from that and toward a system that considers how well a doctor or medical team performs in keeping the patient healthy.

Otter also wants to bring more accountability to medical providers, such as reimbursing them based on patient outcomes, said his spokesman, Jon Hanian.

"The governor believes incentives can be used to motivate people who may otherwise avoid taking some personal responsibility," Hanian said in an email. "That is an important distinction, especially when taxpayers are shouldering more and more of these costs."

FEDERAL EXPANSION

Medicaid has been a federal-state partnership since Congress created it in 1965. It covers low-income children and specific groups of adults, mainly those with disabilities and chronic illnesses.

Whether Idaho opts to expand the program or not, about 35,000 more Idahoans are expected to join Medicaid next year because they already are eligible.

The optional expansion would mean that Medicaid would cover nearly one in four Idahoans.

Hanian said Otter wants to consider options along the lines of one that already exists for Idaho's Children's Health Insurance Program, which covers children whose family incomes are too high for Medicaid. Some lower-income families who have CHIP coverage can opt to receive a $10 monthly credit to offset their $10 or $15 premiums. The premium credit hinges on whether the child is up to date on shots and receives regular wellness checks.

"We saw a 60 percent increase in parents seizing upon that incentive," Hanian said.

STATES' FLEXIBILITY

The U.S. Department of Health and Human Services said in December that states can include personal-responsibility options, depending on how they're designed.

"We note in particular that states have considerable flexibility under the law to design benefits for the new adult group and to impose cost-sharing, particularly for those individuals above 100 percent of the federal poverty level, to accomplish these objectives, including Secretary-approved benchmark coverage," the agency said.

With that in mind, the Department of Health and Welfare is drafting a skeletal plan called "Healthy Idaho" to have something ready to roll out if the Legislature expands Medicaid.

The plan has two parts.

The first targets health care providers, pushing them to work in ways that would be cheaper for Medicaid by paying them for overall care, not for each service, and possibly by rewarding them with a share of the money saved.

The second aims at patients, rewarding them with credits toward future copays when they take preventive steps such as receiving mammograms or vaccinations or giving up tobacco.

An office-visit copay for someone on Medicaid is less than $4 now. But that can be a deal-breaker for people who earn little enough to qualify, said Denise Chuckovich, deputy administrator for Medicaid, behavioral health and managed care.

Offering credits for that $4 could be Idaho's investment in keeping its residents healthy and out of the hospital, she said.

"We've been having conversations with (the Centers for Medicare and Medicaid Services) about this design and making tweaks as we talk with them and find out what they will and won't allow us to do," she said.

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Audrey Dutton: 377-6448, Twitter: @IDS_Audrey

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