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DHHR Medicaid estimates inflated

CHARLESTON, W.Va. -- The West Virginia Department of Health and Human Resources told the Legislature last week that as many as 260,000 West Virginians might be newly insured by Medicaid at a cost of between $25 million to $104 million a year, if Congress passes a health-reform bill.

Those numbers are greatly inflated, health-care reform advocates said Thursday.

The DHHR based its estimates on numbers that include all uninsured West Virginians, not just those eligible for Medicaid, the chief financial officer of the DHHR confirmed Thursday.

"I'm completely floored by these numbers," Rep. Shelley Moore Capito said Wednesday. "I simply don't know how our state can absorb such a massive new liability."

However, the DHHR's 260,000 estimate is impossible by Census data, health-reform advocates say.

"That's more than double the number of new enrollees anybody else estimates," Perry Bryant, director of West Virginians for Affordable Health Care said Wednesday. "I am truly puzzled by their numbers."

The DHHR number is based on "talking points" from the House Committee on Energy and Commerce, DHHR spokesman John Law said Thursday.

Tara Buckner, DHHR chief financial officer, told the Gazette on Thursday that Medicaid officials got their numbers from an item in the "talking points" labeled "provide coverage for uninsured residents."

"We added up the numbers from the three Congressional districts," Buckner said. They assumed all those people were Medicaid-eligible, she said.

"Those numbers are not just Medicaid," Bryant said. "They also include West Virginians who will not get their insurance through Medicaid, all the people who will buy insurance, subsidized or not, through the new insurance exchange."

"They used a number of uninsured that's well above what the Census data shows," said Judy Solomon, Senior Health Care analyst of the Center on Budget and Policy in Washington, D.C. "They also assumed that all eligible people will enroll, but no public program ever comes close to 100 percent participation."

When Census data is used, Bryant said, the number of new enrollees "drops significantly and will be more than counterbalanced by new benefits."

West Virginia stands to receive hundreds of millions of federal dollars for expanded community health services and individual insurance subsidies under the reform bills, Bryant said. "Tens of thousands of people newly insured by Medicaid would no longer leave unpaid hospital and emergency room bills that drive up everyone's cost."

The amount the state would pay in return depends on the number of people to be newly covered by Medicaid. Under the Senate bill, West Virginians who earn up to 133 percent of the federal poverty level could get Medicaid insurance. Under the House bill, the cutoff is 150 percent.

If the 260,000 new people were to enroll in Medicaid as the DHHR predicts, the state would pay an average of $25 million a year under the House bill and an average $104 million a year under the Senate bill between now and 2019. The total could range between $147 and $725 million.

"The amount would be far less than that, when Census figures are used," Bryant said.

The federal government would pay 100 percent of the cost of new enrollees until fiscal year 2018, then would pay 91 to 95 percent for two years. Then the rate might go back to the present 73 percent.

To calculate the 260,000 figure, the DHHR's Law said, the agency started with the talking points numbers. "Then we trended it forward, based on our recent experience at Medicaid."

The DHHR report also says 32,091 West Virginians under 18 would be newly enrolled in Medicaid by 2019, Bryant noted. "But the 2008 Census Bureau figures say there are only 9,000 uninsured West Virginians now from families that make less than 200 percent of the poverty level," Bryant said. To be eligible for Medicaid, the family could make no more than 150 percent of poverty.

"How do you get from 9,000 at 200 percent to 32,000 at 150 percent? Are they saying there will be almost four times as many uninsured children in 2019?"

To calculate the under-18 figures, Law said, the DHHR calculated the percentage of uninsured young people they believe could be eligible and trended that forward, using data from the Childrens Health Insurance Program and Medicaid enrollment statistics.

For the 260,000 estimate, the DHHR started with the all-inclusive figure in the talking points from the House Committee on Energy and Commerce. "Then they trended that number forward based on our recent experience of growth in the Medicaid program," Law said.

Bryant made the following points about the 260,000 estimate:

| The Census Bureau says 271,000 West Virginians of all incomes were uninsured in 2008.

| The Kaiser Family Foundation estimates that less than two thirds of the uninsured earn less than 200 percent of poverty level, Bryant said.

| That amounts to about 178,000 West Virginians at 200 percent of the poverty level.

"It's a stretch from 178,000 to 260,000," he said. "You'd have to assume a huge increase in the number of uninsured."

Bryant said he has requested a meeting with Medicaid officials. "I'd very much like to get to the bottom of this. I'll meet with them whenever they have time."

An actuarial analysis performed for West Virginians for Affordable Health Care in 2009, based on the lower estimates, shows that the state could have a net savings with health-care reform, Bryant said.

Rachel Morgan, senior health policy analyst for the National Conference of State Legislatures, said the NCSL has not yet produced any state-by-state estimates.

"It's premature," she said. "The data isn't firm enough to really put that together yet. We don't know what percentage of the federal poverty level they're going to pick. We don't know if they're going to change the formulations.

"Everybody is clamoring for those numbers, but there is no final bill out there, so it's just impossible to put it together."

"There are so many variables to be taken into account," she said. "This will be a lot easier to get a grip on once there's one bill and we really know what we're talking about."

Read the House Committee on Energy and Commerce "talking points" here.

Reach Kate Long at katelong@wvgazette.com or 348-1798.


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