The Next Steps for Medicaid Expansion

Apr 23, 2015

The Montana Budget and Policy Center is celebrating this week, as legislators on both sides of the aisle worked together to pass Medicaid expansion in both the House and Senate. After passing third reading in the Senate on Saturday morning, the Montana HELP Act is on its way to the Governor’s desk, where he is expected to sign the bill into law. And while some very hard work is behind us, we’re not quite done yet. Once the Governor signs the Montana HELP Act, Medicaid programming will not immediately go into effect. Next, the state will have to submit a section 1115 waiver to the federal government to expand coverage and receive increased federal funds. Section 1115 waivers allow states to pursue experimental, pilot, or demonstration projects that promote the objectives of Medicaid, namely to keep low-income families healthy. (It’s called “1115 waiver” for short, because of the section in the Social Security Act where this flexibility is provided.) Most of the 28 states that have expanded Medicaid coverage did it in the “traditional” form. The state simply raised eligibility levels under its current Medicaid program and accepted the higher federal match to do so. However, six states (Arkansas, Indiana, Iowa, Michigan, New Hampshire, and Pennsylvania) expanded coverage through the 1115 waiver process, which enables the state to craft its own expansion plan while still promoting the goals of the Medicaid program and protecting enrollees. Montana will join these states in expanding coverage using this waiver. The Montana Department of Health and Human Services (DPHHS) will submit the 1115 waiver for approval by the federal Center for Medicaid and Medicare Services (CMS). CMS has made it clear that it will not approve a waiver that limits the number of eligible people who can be enrolled under the plan. The waiver request must also show that the program will not cost the federal government more than traditional expansion over a multi-year period (otherwise known as budget neutrality). As DPHHS and stakeholders in the state move forward with this process, which will take a few months, we can learn from other states that have received waiver approval from CMS. The 1115 waiver process is an important step, and we will be closely following it. 70,000 Montanans are depending on it.
Montana Budget & Policy Center

Shaping policy for a stronger Montana.

MBPC is a nonprofit organization focused on providing credible and timely research and analysis on budget, tax, and economic issues that impact low- and moderate-income Montana families.