COLUMBUS, Ohio — Republican Gov. John Kasich’s administration said Wednesday it’s moving forward with plans to require more than 1 million Ohioans on Medicaid to pay a new monthly cost for their health coverage or potentially lose it.
House Republicans added the provision to the state budget last year. The new charge would require federal approval. If successful, officials plan to begin requiring Medicaid recipients to pay into a health-savings account to support the cost of their coverage beginning in 2018.
More than 2.9 million Ohio residents are served by Medicaid, a $23 billion federal-state health program for low-income and disabled people.
Under the House Republicans’ plan, the administration must seek a waiver of federal Medicaid rules so that Ohio can require certain Medicaid recipients to pay into a health-savings account regardless of their income. Beneficiaries, except pregnant women, could be cut from the safety net program if they don’t annually contribute 2 percent of their family income or $99, whichever is less.
Ohio Medicaid Director John McCarthy said Wednesday the administration will make a draft of its waiver available for public comment beginning April 15. Two public hearings are planned over the 30-day comment period that ends May 13.
The state will then incorporate the feedback into its draft, though legislators left few areas open to change.
“The law is fairly specific about what we have to submit,” McCarthy said.
The administration tentatively plans to send the waiver application to the federal Centers for Medicare and Medicaid Services for approval in mid-June.
The draft proposes a January 2018 start date for the health-savings account program. That’s slated to be the final year of Kasich’s term, though the two-term governor currently is running for president.
McCarthy said the start date could shift, depending on federal approval and how quickly new Healthy Ohio program could be implemented. Washington handles each waiver request uniquely, he said, and it’s unclear how federal officials could rule.
“This waiver, like any waiver, you’re uncertain of where you stand when you’re submitting it,” he said.
Still, no state has been given approval to drop Medicaid enrollees with incomes below federal poverty for not having paid monthly fees or contributions to a health savings account, according to a policy brief from the Kasich administration. Indiana got federal permission to test its health savings accounts in Medicaid, but it does not terminate people below the poverty level for failing to contribute.
Administration officials said they cautioned state lawmakers during the budget process about the lack of precedent for some aspects of the proposal.
The plan also would require the Medicaid program to deposit $1,000 annually into each person’s health savings account. Healthy Ohio enrollees would be subject to copayments, but only if there’s a balance in their accounts. Health plans couldn’t pay for any service until the person’s health savings account is depleted.
House GOP’s program replaced a plan from Kasich to charge a monthly premium of about $20 to roughly 120,000 people on Medicaid.
The Republican state lawmakers had argued that cost-sharing policies like the savings accounts would encourage “personal responsibility” in the program.
Health care advocates and Democrats have said the policies create barriers to health care for those with little money.