Oregon: Bill introduced to establish Medicaid buy-in & re-establish Individual Mandate Penalty
Lawmaker proposes Medicaid buy-in and individual mandate for Oregonians
Representative Andrea Salinas, the new Chair of the House Health Care Committee, recently filed a bill that aims to establish a Medicaid buy-in option for Oregon residents. The bill, HB 2009, would also establish a “shared responsibility penalty,” or an individual mandate for Oregonians.
HB 2009 would essentially allow individuals who do not qualify for Medicaid, or for premium tax credits under the Affordable Care Act, to enroll in CCOs by paying premiums to cover their health services.
(Note: "CCOs" = "Coordinated Care Organizations", which I believe is how Oregon designates their Medicaid program.)
Eligible residents for the buy-in plan include those earning between 138 and 400 percent of the federal poverty levels (FPL). Individuals between 400 and 600 percent of FPL could also buy into the Medicaid benefit plan if they are required to pay the full cost of their premiums through their employer-sponsored health insurance.
Hmmm...I'm a little confused about this...it makes it sound like middle-class people who aren't covered through their employer wouldn't be eligible but those who are covered through their employer would be...if they paid full price...which, of course, people covered through their employer almost never are. I'm fairly certain this is referring to those on the individual market who don't qualify for subsidies; nothing else makes any sense.
The bill would also establish the “State Shared Responsibility Penalty” for full-time residents who are not enrolled in “minimum essential coverage” for at least nine months of the year. Penalties collected would be deposited into the Oregon Health Authority Fund to be used for outreach and premium assistance for those enrolling in the buy-in plan.
I naturally assumed the mandate penalty would be the same as the federal one under the ACA (either $695 per adult or 2.5% of household income, whichever is larger), but whoa...when I read the actual text of HB2009, it's...a bit steeper:
The penalty is an amount equal to nine percent of the individual’s taxable income as reported on the individual’s income tax return.
Whoa. That'd be around 3.6x as much as the ACA's penalty. There's exemptions, of course:
An individual is not subject to the penalty under subsection (2) of this section if: (a) The out-of-pocket costs for the minimum essential coverage available to the individual exceed nine percent of the taxable income reported on the individual’s income tax return; (b) The out-of-pocket costs for the minimum essential coverage available to the individual and the individual’s spouse and dependents, if applicable, exceed nine percent of the taxable income reported on the individual’s income tax return; (c) The individual was not a resident in this state for at least 11 months of the tax year; or (d) The individual had good cause for failing to enroll in minimum essential coverage as prescribed by the authority by rule.
Getting back to the Medicaid buy-in option...
Rep. Salinas gave us a preview of her plans for the Medicaid buy-in prior to filing the bill in this Q&A. In it, she estimates that the monthly premium for those buying into Medicaid could range from $500 to $600.
“You know, I think the question is, is that Medicaid plan and that premium affordable enough?… But, recognizing that there are no costs at transaction times – so there’d be no co-pays, no deductibles — you know, for some people that could be really beneficial,” said Salinas.
Of course, as with all Medicaid buy-in proposals, there's one big snag...
However, Salinas expressed concern about how the reimbursement rates would impact provider availability.
“Essentially, they would get the same reimbursement rate under the buy-in option that the current Medicaid plan does. So would the networks stay in place and would we have providers? Because that’s kind of the idea — to expand access — and if you don’t have those providers because they don’t like the reimbursement rates, then it does no good.”