Ohio budget for Medicaid would increase in Kasich’s two year budget

Ohio will seek federal approval to begin charging some Medicaid recipients a monthly premium for their health care coverage under a two-year budget plan unveiled Monday by Ohio Gov. John Kasich.

Currently Medicaid recipients pay no monthly premium. Any change would require the federal government to approve a waiver. The premium, if approved, would save Ohio about $200 million over the biennium, according to Kasich’s office.

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The governor, a Republican, proposes a monthly premium of approximately $20 per month for childless, non-pregnant adults with incomes above poverty. It would apply mostly to people who receive Medicaid under expanded coverage funded by the Affordable Care Act and be capped not to exceed 2 percent of household income.

Medicaid, the state’s health care funding program for low income people, is the Ohio’s largest single program and has a significant federal match.

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“Medicaid clearly continues to be the Pac-Man of the state budget,” said Greg Lawson, senior policy analyst for the conservative-leaning Buckeye Institute for Public Policy Solutions. “We like some of the personal responsibility portions that have been included, including some premiums.”

Kasich’s proposal increases the budget for Medicaid but does not address what will happen if President Donald Trump and the Republican Congress repeal the Affordable Care Act as they’ve promised. The federal government reimburses the state for nearly all the costs of expanding Affordable Care Act health care coverage to 700,000 people through Medicaid.

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In his budget presentation Monday, Kasich urged Congress to replace the Affordable Care Act at the same time it is repealed, thus protecting against the possibility of tens of thousands of Ohioans losing their health insurance.

Lawson has concerns about Kasich’s proposal to replace a sales tax on Medicaid managed care providers with a fee for all managed care providers. The sales tax was disallowed under federal rules.

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Wendy Patton, senior director of the liberal-leaning Policy Matters Ohio, is concerned the communities won’t be made whole for the lost sales tax revenue. But she is pleased that Kasich preserves the expansion of Medicaid through the Affordable Care Act.

“We think that’s good news for 700,000 Ohioans and their families, the working poor that are covered by this expansion,” Patton said.

When all funds are considered, Medicaid appropriations would increase 6.2 percent in fiscal year 2018 to $28.1 billion and increase 2.7 percent in fiscal 2019 to $28.8 billion.

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However, spending on Medicaid from the state’s General Fund would go down — to 15.6 billion in fiscal year 2018, or a 12.6 percent cut. Spending would increase by 2.7 percent in the budget’s second year, evening out at $16 billion.

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