Maine and the ACA’s Medicaid expansion

Governor Mills has signed an executive order directing the state to expand Medicaid by February 1, 2019

maine Medicaid guide

Medicaid expansion in Maine

Governor Mills signs executive order to expand Medicaid by February 1, 2019

As detailed below, Maine voters passed a Medicaid expansion ballot initiative in November 2017, and coverage was to be effective by July 2018. But former Governor Paul LePage was adamantly opposed to Medicaid expansion, and spent all of 2018 refusing to adhere to the will of the voters on this issue. Governor Janet Mills, a Democrat, took office on January 2, 2019. Her first executive order, signed on January 3, instructs the Maine Department of Health and Human Services to work with the federal government to implement Medicaid expansion by February 1, 2019.

The order also notes that the state will “work expeditiously towards resolving issues affecting those who applied for coverage between July 2, 2018 and January 2, 2018.” That’s a nod to the Mills Administration’s plan to provide retroactive coverage to people who would have been covered starting before February 1 (as early as July 2, 2018) if not for the LePage Administration’s obstruction of Medicaid expansion.

Mills has nominated Jeanne Lambrew to be the state’s new Commissioner of DHHS, so Lambrew will be tasked with implementing Medicaid expansion in the state. Lambrew previously worked for the Obama Administration, as Director of the Office of Health Reform. An estimated 70,000 to 80,000 people are expected to be eligible for coverage under Medicaid expansion in Maine, and the state will start working immediately to provide outreach and enrollment assistance to people who are eligible for Medicaid under the new rules.

Virginia expanded Medicaid as of January 1, 2019. With Virginia and Maine both in the Medicaid expansion camp, there are only 17 states that have not yet expanded Medicaid. And voters in three of them approved ballot initiatives that call for Medicaid expansion in 2019.

Voters approved Medicaid expansion in 2017, but Governor LePage blocked implementation throughout 2018.

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After years of battling with their Governor, advocates for Medicaid expansion in Maine took the issue to the voters in the 2017 election. Question 2, the Medicaid Expansion Initiative, was approved, with 59 percent of voters supporting Medicaid expansion.

Unlike some other states that have used 1115 waivers to expand Medicaid with state-specific guidelines, Question 2 initiates a straightforward expansion as called for under the ACA, so Maine’s Department of Health and Human Services essentially just had to inform HHS, with a state plan amendment, that their Medicaid program will expand as called for in the ACA, rather than requesting HHS approval to create a unique approach to expansion.

Under the terms of the ballot initiative, Maine had until April 3, 2018 to submit a proposal to the federal government (a state plan amendment) outlining their plan to expand Medicaid. And they had until July 2 to start enrolling eligible Maine residents in expanded Medicaid. This was required under state law with the passage of the ballot initiative, and no legislation was necessary in order to move forward with expansion.

But April 3 came and went, and Governor Paul LePage’s administration did not submit a Medicaid expansion proposal to CMS. LePage steadfastly refused to expand Medicaid — even after the ballot initiative passed — until lawmakers come up with what he considered adequate funding (it’s noteworthy that LePage’s office cited a much higher state cost for Medicaid expansion than the projection from the Maine Office of Fiscal and Program Review), and LePage included several constraints in terms of what he’d allow as far as funding sources, saying that lawmakers couldn’t raise taxes or tap the state’s rainy day fund. Indeed, LePage even vetoed legislation in July 2018 that would have allocated funding for Medicaid expansion (in late December, a few days before leaving office, LePage called for taxing hospitals to pay for Medicaid expansion).

Maine received a one-time tobacco settlement of $35 million, which Mills suggested could be used to fund the state’s share of Medicaid expansion costs in the first year (at that point Mills was the Maine Attorney General; she has since become governor). The state also had $128 million in projected surplus revenue that could be used to fund expansion, but LePage pushed back against both suggestions. Medicaid expansion advocates were hoping for a legislative solution in April 2018, as opposed to a protracted legal battle, but they noted that if necessary, they would sue the LePage Administration in order to implement the legally binding ballot initiative.

The 2018 legislative session ended without an agreement on Medicaid expansion funding, and on April 30, a lawsuit was filed against the Maine Department of Health and Human Services. The plaintiffs in the case include two consumer advocacy groups (Maine Equal Justice Partners and Consumers for Affordable Health Care), the membership organization that represents Maine’s Community Health Centers (Maine Primary Care Association), the largest federally qualified health center in Maine (Penobscot Community Health Care) and five Maine residents who will gain access to Medicaid once expansion is implemented.

The lawsuit requested that the Maine Department of Health and Human Services file a state plan amendment with the federal government within three days, and move forward with the rest of the Medicaid expansion process in an expedited fashion, so that the coverage expansion could take effect by July 2, as originally scheduled. The petitioners also filed a motion to expedite the lawsuit.

In mid-May, the LePage Administration responded to the lawsuit, arguing that they could not proceed with the implementation of Medicaid expansion until the Maine legislature allocated funding for the state’s costs associated with expansion (lawmakers did pass legislation to allocate funding, but LePage vetoed it in early July). A few days later, attorneys for Maine Equal Justice Partners countered with a filing noting that the state already had enough money to fund the first year of Medicaid expansion without having to allocate any new funds, and clarifying that the administration could not legally refuse to implement the law, regardless of the governor’s personal opposition to Medicaid expansion.

On June 4, Superior Court Justice Michaela Murphy ruled that the Maine Department of Health and Human Services had to proceed with filing a Medicaid expansion plan (a state plan amendment, or SPA) with the federal government, giving them until June 11 to do. The ruling noted that there is no cost associated with submitting an SPA to the federal government, and thus the lack of appropriation for the state’s portion of the cost of Medicaid expansion was immaterial.

Although Maine Insurance Commissioner Ricker Hamilton filed an appeal, the court order prevailed and the state did ultimately move forward with submitting the state plan amendment to the federal government in August. But Gov. LePage sent the Trump Administration a strongly worded letter encouraging them to reject the state plan amendment that Maine was submitting.

Oral arguments in the court case were heard in early November, more than five months after Medicaid expansion was originally supposed to take effect. A judge ordered the LePage Administration to implement Medicaid expansion by December 5, but LePage’s Administration requested a stay in the order, and managed to delay expansion of Medicaid until LePage left office.

On December 6, the judge rejected the LePage Administration’s request for a stay, but did push back the Medicaid expansion implementation deadline to February 1, 2019, albeit with retroactive coverage for people who applied since July 2018. In Judge Michaela Murphy’s decision, she noted that “the Respondent [LePage’s Administration] has persisted in hyperbolic claims of fiscal calamity, despite the uncontested factual record before the court…” In other words, the Administration’s hand-wringing about the financial crisis that Medicaid expansion would cause was unfounded in the eyes of the court. In her ruling, Murphy also clarified that once Medicaid expansion is implemented, retroactive coverage should be available to people who applied since July 2, 2018:

“The Court would emphasize that the extension of the deadline to comply should not be confused with a central holding of the prior Order. The people of Maine enacted a law that requires payment of Medicaid benefits to an expanded class of Maine citizens, and any person who meets the qualifications clearly spelled out in the Expansion Act are entitled to those benefits as of July 2, 2018.”

The case revolved around the fact that the LePage Administration said that Medicaid expansion couldn’t happen without an allocation of funds (keeping in mind that LePage vetoed the allocation of funding in the summer of 2018), while the Attorney General (who is now the Governor) and Maine Equal Justice Partners countered that the state already had adequate funding to cover the first year of Medicaid expansion costs, and additional funding can be addressed in the next legislative session. Either way, Medicaid expansion is the law — regardless of funding issues — under the terms of the ballot initiative that was approved by the voters in 2017.

I discussed the situation with the Maine People’s Alliance in June 2018, and they noted that their hope was that once the situation was resolved, expanded Medicaid coverage would be available with a retroactive effective date as early as July 2, for people who applied by that date. That’s what Judge Murphy ordered in November 2018 (expansion was to be implemented by December 5, with coverage retroactive to July 2), and again in December (expansion now to be implemented by February 1, 2019, but with coverage retroactive to July 2, 2018).

Consumer advocates have been encouraging people to apply for MaineCare for months, on the premise that coverage could eventually be provided on a retroactive basis. Maine Equal Justice Partners confirmed in October that people are continuing to apply for MaineCare under the terms of Medicaid expansion, but are receiving rejection notices. It’s unclear at this point whether retroactive coverage will eventually be made available, as it’s likely to be 2019 before the situation is resolved. It’s also unclear whether Gov-elect Mills will be able to move forward with expansion on day one as governor, or whether she’ll be setting the ball rolling for gaining federal approval for the state plan amendment. The latter would be a longer process, although it appears that the goal is to implement Medicaid expansion as soon as possible, and with coverage retroactive to July 2.

2018 governor’s race was crucial for Medicaid expansion in Maine

LePage was term-limited and did not run for re-election in 2018. Democrat Janet Mills, who serves as Maine’s Attorney General, won the race after battling with LePage on various issues during her term as AG. Mills has long supported Medicaid expansion and signed an executive order on her second day in office that directs the state to expeditiously expand Medicaid.

Two other Independent candidates, Alan Caron and Terry Hayes, also supported Medicaid expansion. But Shawn Moody, the Republican candidate, had views that largely mirrored LePage’s: His approach was that Medicaid expansion should only happen if and when funding is allocated, and he called for LePage’s same qualifiers and restrictions for potential funding sources. Moody did not prevail in the election, however, so Maine’s long battle over implementing the will of the voters came to an end as soon as Janet Mills took office.

Approved 1115 waiver calls for a work requirement, premiums, asset test, & end retroactive eligibility — but Gov Mills might not implement it

Not only did LePage refused to move forward with implementation of a legally binding ballot initiative to expand Medicaid, his Administration actively worked to make the state’s existing Medicaid eligibility guidelines more stringent. Under the direction of Ricker Hamilton, whom LePage appointed to lead the state’s Department of Health and Human Services in 2017, Maine submitted an 1115 waiver, which was received CMS approval in December 2018. It’s expected however, that Governor Mills may disregard the waiver, so it might not be implemented at all.

Several states have submitted 1115 waivers to the Trump Administration, seeking various changes that were never allowed under the Obama Administration. But Maine’s goes farther than most. The state’s waiver proposal requested a work requirement for people up to age 64, premium contributions required if household income is 51 percent of the poverty level or above (for a family of four, that would start at incomes under $13,000/year), an asset test (with Medicaid only available to people with assets of under $5,000, as opposed to the current income-based system), and the elimination of retroactive eligibility.

Under the Trump Administration, work requirements have also been approved for the Medicaid programs in Arkansas, Indiana, New Hampshire, Wisconsin, Michigan, and Kentucky, and several other states are awaiting similar waiver approvals. Premiums and the elimination of retroactive eligibility have also been approved for some states, but no state has received approval to implement an asset test, and Maine’s waiver approval did not grant the state permission to impose an asset test (asset tests were used in some states prior to the ACA, but the ACA switched all Medicaid programs to an income-based eligibility system, although eligibility for Medicaid to pay for long-term care still has an asset test).

Notably, Maine’s 1115 waiver would not expand Medicaid coverage in any way. Several states have used 1115 waivers to implement state-specific variations of Medicaid expansion, but the LePage Administration instead proposed a waiver that, if implemented, would result in fewer people enrolled in Maine’s Medicaid program. That was LePage’s goal all along, but Governor Mills does not have the same approach, and might opt not to implement the state’s new Medicaid waiver provisions.

Other states followed Maine’s ballot initiative lead

In all of the other states that have expanded Medicaid, the decision was made either by lawmakers or the governor or both — Maine was the first state where the issue was decided via ballot initiative. The success of the ballot measure in Maine inspired similar initiatives in other states where there was strong grassroots support for expansion (despite the fact that Maine has faced such an uphill battle with the governor’s resistance to implementing the will of the voters). Idaho, Missouri, Nebraska, Oklahoma, South Dakota, Utah, and Wyoming are all states that have thus-far rejected Medicaid expansion, but that allow citizens to place measures on the ballot.

And in three of those states, voters approved Medicaid expansion ballot initiatives in the 2018 election. Voters in Utah, Nebraska, and Idaho had the opportunity to vote on Medicaid expansion in 2018, and it passed in all three states. And Montana voters got to decide on a ballot initiative to generate funding to keep Medicaid expansion in place (the state has already expanded Medicaid, but without reauthorization and additional funding, it will end in mid-2019). That measure did not pass, however.

Most of the states that have expanded Medicaid did so as soon as possible, with coverage effective January 2014. But there have been several late expansions, the most recent of which were Louisiana, in July 2016, followed by Virginia in January 2019.

Governor LePage’s year-long delay of Medicaid expansion

Although Question 2 had strong support from voters in the 2017 election, Governor Paul LePage — who has long been outspoken in his opposition to Medicaid expansion — vowed immediately that implementation would not move forward until state lawmakers could find a way to fund the state’s portion of the cost of Medicaid expansion (the up-to-10 percent of costs that the state will have to pay). And LePage laid out several conditions in terms of that funding, saying that he wouldn’t support any measures that involve raising taxes, cutting benefits for existing disabled and/or elderly Medicaid enrollees, or tapping into Maine’s rainy day fund.

The 2018 legislative session ended in April, without any measures to allocate funding for Medicaid expansion (although lawmakers returned in June for a special session that continued until September). But Maine People’s Alliance explained that because the ballot initiative became law, Medicaid expansion will eventually move forward, regardless of whether the legislature specifically allocates money to cover the state’s portion of the cost.

The state’s cost for the first full year of expansion is projected to be about $31 million to 55 million, while the federal government will contribute about $490 million to $525 million. These numbers make it clear why Medicaid expansion is a win for states; half a billion dollars in federal funding being pumped into the state’s economy will have a positive impact that goes well beyond the effect for people who gain coverage; thousands of jobs will be created, hospitals—particularly rural hospitals—will be more likely to remain financially viable, and of course, fewer people in Maine will be uninsured.

By February 2018, activists rallied during LePage’s State of the State address, and frustrations were mounting that the state had not yet made visible progress towards outlining an expansion proposal to submit to the federal government by the beginning of April. But according to Maine People’s Alliance, while Gov. LePage can throw up roadblocks that delay the process — as could Republican candidate for governor, Shawn Moody — the executive branch cannot perpetually prevent Medicaid expansion from taking effect.

Lawmakers in Maine had been trying for years to accept federal funding to expand Medicaid and provide coverage for at least 70,000 of the state’s lowest-income residents (some of these people are eligible for premium subsidies in the exchange, but people with income under the poverty level are in the coverage gap created by the Governor’s refusal to expand Medicaid). Over the years, they’ve passed five bills that called for expanding Medicaid, but Governor LePage’s ongoing opposition on the issue has been an insurmountable stumbling block. LePage has vetoed all five Medicaid expansion bills, and lawmakers have not had the votes to override his vetoes. The 2016 bill, LD633, passed but only by one vote — far from a veto-proof majority. It was tabled and died at the end of the 2016 legislative session.

Medicaid has been a political battle in Maine. Not only has LePage rejected Medicaid expansion, he also cut existing coverage through eligibility changes that went into effect March 1, 2013, and Jan. 1, 2014. And many Republicans in the legislature have also opposed Medicaid expansion, preventing the legislature from getting enough votes to overcome LePage’s vetoes.

Wording of the ballot initiative was contentious

The Maine Secretary of State announced in February 2017 that the initiative to expand Medicaid had garnered enough signatures to appear on the November 2017 referendum ballot. But the wording of the ballot initiative became a point of contention, with proponents of Medicaid expansion calling it “insurance” and opponents — including LePage — insisting that it be called “welfare” or something similar.

Ultimately, the wording of the ballot initiative was changed to “coverage” and the official language of Maine Question 2 is as follows:

“Do you want Maine to expand Medicaid to provide healthcare coverage for qualified adults under age 65 with incomes at or below 138% of the federal poverty level, which in 2017 means $16,643 for a single person and $22,412 for a family of two?”

According to Ballotpedia, Medicaid expansion supporters had raised $196,163 by September 22, 2017 in support of a “yes” vote on Maine Question 2. Opponents had raised $229. Ultimately, by the conclusion of the campaign, supporters of Question 2 had raised nearly $2.7 million, while opponents had raised about $428,000.

Eligibility guidelines for Maine Medicaid

As of 2016, Maine residents who meet the following income limits qualify for Medicaid:

  • Children up to 1 year old: 191 percent of the federal poverty level (FPL)
  • Children ages 1 to 18: 157 percent of FPL; children with family income up to 208 percent of FPL qualify for the Children’s Health Insurance Program
  • 19 and 20 year olds: 156 percent of FPL
  • Pregnant women: 209 percent of FPL
  • Parents and other caretakers: 100 percent of FPL

Details for each state’s Medicaid and CHIP eligibility rules are here.

Apply for MaineCare

Maine’s Medicaid program is called MaineCare. If you think you may qualify, here is how you can submit an application.

LePage reversed Maine’s pre-ACA Medicaid expansion

Gov. LePage has reversed the course on Medicaid set by former Gover John Baldacci, who authorized Dirigo Health in 2003. The program expanded Medicaid and subsidized private health insurance for middle-income residents. However, the program faced several financial difficulties as about 25 percent of the state’s residents enrolled in Medicaid by 2010 and Medicaid spending consumed nearly 30 percent of the state budget. The state fell behind in Medicaid reimbursements to hospitals, which were due nearly $500 million in state and federal payments.

LePage took office in 2011 and has since led efforts to cut the state’s Medicaid program. First, he reduced the eligibility limits for adults with dependents and reduced benefits for elderly Medicaid beneficiaries. Second, Maine ended coverage for adults without dependents, effective Jan. 1, 2014. The stricter eligibility limits resulted in about 25,000 people losing Medicaid eligibility. Third, the LePage administration petitioned the federal government for approval to end coverage for 19- and 20-year olds.

When the federal government rejected the request, the administration appealed the decision in circuit court with the help of outside counsel. The state’s attorney general declined to represent the state, saying the appeal had lacked merit. The 1st Circuit Court of Appeals in November 2014 upheld the federal government’s decision. The state petitioned to have the case heard by the Supreme Court, but the petition was denied in June 2015. Since the Supreme Court wouldn’t hear Maine’s case, the lower court’s decision stands, and Maine has continued to provide Medicaid coverage for roughly 6,500 eligible 19 and 20-year-olds.

As of October 2014, about 291,000 people were enrolled in MaineCare. By July 2016, enrollment had decreased to 270,827. And by November 2017, it had decreased even further, to 261,478. It stabilized at around that level, but declined slightly by August 2018, to 261,021. Nationwide, Medicaid/CHIP enrollment has grown by 29 percent since the end of 2013, including states that have expanded Medicaid as well as those that have not. Medicaid enrollment in Maine is expected to increase by at least 70,000 people once coverage is expanded, which will take it well above the 291,000 who were enrolled as of 2013.

But as described above, the state also has a pending 1115 waiver that was submitted to HHS in August 2017. If approved, it would result in fewer people covered under Maine’s Medicaid program, as it includes proposals for a work requirement, premiums, an asset test, and the elimination of retroactive eligibility.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

How to apply in ME

Go to MyMaineConnection to apply online. Print an application and mail it 114 Corn Shop Lane, Farmington, ME 04938. Call 1-855-797-4357 to enroll by phone. Visit your local Office for Family Independence to enroll in person.

Eligibility: Children up to 1 year old with household income up to 191% of FPL. Children ages 1-18 with household income up to 157% of FPL; children with family income up to 208% of FPL qualify for the Children’s Health Insurance Program. 19 and 20-year-olds with household income up to 156% of FPL; pregnant women with household income up to 209% of FPL; parents and other caretakers with household income up to 100 percent of FPL.

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