Medicaid eligibility and enrollment in Utah

ACA’s Medicaid eligibility expansion in Utah

Medicaid was partially expanded in Utah as of April 2019. But under the terms of a new waiver that CMS approved in December 2019, the state fully expanded Medicaid as of January 2020 — albeit with a work requirement, as described below. But the work requirement was suspended as of April 2020, due to the COVID-19 pandemic, and approval for it was revoked by the Biden administration in 2021. So Medicaid is fully expanded in Utah, without a work requirement.

Medicaid coverage is available to adults under the age of 65 with household income up to 138% of the federal poverty level (FPL). For a single adult, that’s $20,120 in annual income as of 2023. (That number will start to be used by the spring of 2023; until then, the 2022 FPL numbers are used, meaning that a single adult is eligible for Medicaid in Utah with an annual income of $18,754.) Note that Medicaid eligibility can be determined based on either annual income or current monthly income. This differs from premium subsidy eligibility for private plans, which is always based on total annual income.

As of February 2023, there were nearly 125,000 low-income adults covered under Utah’s Medicaid expansion program. (In Utah’s Medicaid enrollment report, these are broken into four categories, depending on whether they are parents and how old they are.)

The previous partial Medicaid expansion in Utah granted eligibility to adults age 19-64 with income as high as the poverty level (that was $12,490 for a single person in 2019). But Utah was not receiving the enhanced federal Medicaid expansion funding, which under the ACA requires expanding eligibility to 138% of FPL. Now that the full expansion has taken effect, Utah is receiving full Medicaid expansion funding (ie, the federal government pays 90% of the cost) for the entire Utah Medicaid expansion population, including the group that had already gained coverage under the partial expansion.
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The process of Medicaid expansion in Utah was a bit of a winding road. Here’s the backstory:

Voters approved Utah’s ballot initiative to expand Medicaid, but Republican lawmakers scaled it back

By 2018, Utah was in its fifth year of rejecting federal funding to expand Medicaid under the Affordable Care Act’s guidelines. But during the 2018 legislative session, Utah enacted H.B.472, which directed the state to submit an 1115 waiver proposal to CMS by January 1, 2019, requesting approval for Medicaid expansion in Utah, but only for people earning up to 95% of the federal poverty level (essentially 100%, after the 5% income disregard).

For perspective, the ACA calls for Medicaid expansion to adults with income up to 138% of the poverty level, so Utah lawmakers wanted to only cover part of that population. Their solution did eliminate the coverage gap in the state, but continued to use private plans in the exchange for people with income over the poverty level.

In the waiver amendment that Utah submitted in June 2018 (to partially expand Medicaid), Utah asked the federal government to pay 90% of the cost (under the ACA, this is only available if a state expands Medicaid to individuals earning up to 138% of the poverty level), and allow Utah to impose a work requirement on some Medicaid enrollees. (As discussed below, the Trump administration rejected the state’s request to receive enhanced federal Medicaid funding without a full expansion of Medicaid.)

While lawmakers in Utah were considering a scaled-back version of Medicaid expansion, consumer advocates were working to gather enough signatures to get a Medicaid expansion initiative on the 2018 ballot in Utah. They were successful, and the Utah Medicaid Expansion Initiative passed with more than 53% support in the 2018 election. The Utah Medicaid expansion ballot initiative, which called for Medicaid to be expanded to households with income up to 138% of the poverty level — with no strings attached — garnered support from numerous groups in the state, including AARP Utah and the Utah chapter of the American Academy of Pediatrics.

The text of the ballot initiative called for Medicaid expansion in Utah to take effect as of April 1, 2019, and for Utah to raise the state sales tax by 0.15% (from 4.7% to 4.85%) in order to fund the state’s portion of the cost of Medicaid expansion.

Utah’s then-Governor, Gary Herbert, said that he would not block Medicaid expansion if the ballot measure passed — which it did — despite his opposition to the ballot initiative (this was in contrast with Maine’s former Governor LePage, who blocked Maine’s voter-approved Medicaid expansion ballot initiative for more than a year; it was eventually implemented when a new governor took over in 2019).

Utah’s limited Medicaid expansion was costing the state more and covering fewer people than full expansion

But just weeks after the 2018 election, GOP lawmakers in Utah intervened to stop the implementation of the Medicaid expansion that voters had approved, opting instead for a version of Medicaid expansion that would cover fewer people and cost the state more, at least in the first few years. S.B.96 was enacted in the 2019 legislative session, reiterating H.B.472’s call for Medicaid expansion only to those with income up to the poverty level.

S.B.96 was enacted in February 2019. The state’s Medicaid expansion ballot initiative had called for expansion to take effect by April 2019, which meant there was very little time to secure federal approval for the modifications the GOP lawmakers wanted to make to Utah’s version of Medicaid expansion.

But since the state already had a pending waiver proposal at CMS with very similar terms to those called for in S.B.96, CMS was able to grant a modified approval of that earlier proposal — albeit at the state’s regular federal funding match rate of about 68%, instead of the 90% federal funding rate that applies in states that have fully expanded Medicaid. The approval came in late March, just in time for the state to implement its limited Medicaid expansion on April 1, 2019. Utah residents with income up to the poverty level were able to begin applying for expanded Medicaid at that point.

As of late May, more than 31,000 people had enrolled in the state’s expanded Medicaid program. Utah automatically transitioned about 17,500 Primary Care Network enrollees (this program is described below in more detail) to the new Medicaid expansion program, but the rest of the new enrollees had applied for coverage after the partial expansion coverage became available.

In addition to partial Medicaid expansion, Utah’s approved waiver also allowed the state to impose a Medicaid work requirement starting in 2020 (this continued to be allowed under the full expansion waiver approval that was granted in late 2019, although the work requirement was suspended due to the COVID pandemic and approval was subsequently withdrawn by the Biden administration).

The initial approved waiver also allowed the state to stop enrolling eligible residents in the expanded Medicaid program if “projected costs for the Adult Expansion Population exceed annual state appropriations.” That provision would have allowed the state to put eligible enrollees on a waitlist if and when enrollment was capped. But the enrollment cap has been eliminated under the approval for full Utah Medicaid expansion.

Despite partial expansion, Utah wanted enhanced federal funding that applies to states with full expansion. But CMS said no.

The Utah Department of Health published an implementation guide for the limited Medicaid expansion and the state’s future plans. It noted that an estimated 70,000 to 90,000 people would be covered under the newly approved version of Medicaid expansion. And Utah’s limited Medicaid expansion did eliminate the coverage gap in the state.

But about 45,000 more people would have been eligible for Medicaid if the state had implemented the Medicaid expansion ballot initiative (as the state ended up doing in 2020). Instead, these individuals (with income from 101% to 138% of the poverty level) continued to be eligible for substantial premium subsidies and cost-sharing subsidies in the exchange in 2019 (their total out-of-pocket costs, including premiums and cost-sharing, would have been lower with Medicaid; the new waiver approval means they became eligible for Medicaid as in 2020).

Utah’s 2018 waiver proposal — based on H.B.472 and mostly approved by CMS in March 2019 — requested enhanced federal funding for Utah’s limited Medicaid expansion proposal (ie, the 90/10 split that otherwise applies only in states that have fully expanded Medicaid). Although CMS granted temporary approval (through January 2021) for Utah to expand Medicaid to adults earning up to the poverty level and impose a work requirement as of 2020, CMS clarified that the state would only receive its regular federal funding match, which is about 68%.

(Note that under the terms of the full expansion waiver that was subsequently submitted and approved, Utah is receiving 90% federal funding for the entire Medicaid expansion population.)

Because 32% of the cost of covering up to 90,000 people would have been a larger amount than 10% of the cost of covering up to 130,000 people, Utah’s initial approach actually would have resulted in the state spending more of its own money to cover fewer of its residents.

The specifics of Utah’s per capita cap proposal

In May 2019, Utah published a draft of their next proposed 1115 waiver (referred to as the “per capita cap” waiver proposal), opening up a public comment period that ran through June 2019.

The per capita cap waiver proposal asked the federal government to switch to the enhanced funding model while still maintaining the income cap for Medicaid expansion eligibility at 100% of the poverty level and keeping the already-approved work requirement.

But in order to make the arrangement more palatable for the federal government, Utah was proposing a per capita funding cap for the enhanced federal funding. As outlined in the draft 1115 waiver, the state planned to work with CMS to develop a per-enrollee base amount that would be adjusted annually and would vary for each of the state’s enrollment groups to account for differing costs across distinct populations.

The state would be able to use leftover funding (ie, if expenses fall below the per capita cap) to offset excess spending in a future year, but if total costs exceed the per capita cap, the state’s funding for that portion of the costs would be covered at the normal Medicaid federal matching rate (ie, for Utah, that’s about 68%)

In July 2019, before Utah had officially submitted the 1115 waiver, they received word from the Trump administration that their request for full Medicaid expansion funding was not going to be approved if they only partially expanded Medicaid. CMS explained that the state’s proposal to receive full Medicaid expansion funding while having people with income between 100% and 138% of the poverty level enroll in subsidized private plans in the exchange “would invite continued reliance on a broken and unsustainable Obamacare system.” (The Trump administration was fairly hostile toward the ACA.)

Utah did go ahead and submit the waiver proposal in late July. CMS sent Utah a letter in August 2019 detailing the fact that full Medicaid funding for partial expansion would not be permitted, but that other aspects of the waiver proposal were still being considered by the agency. The state’s efforts to cap Medicaid expansion at 100% of the poverty level are now a moot point, since full expansion took effect in January 2020. But the per-capita cap proposal is still pending at CMS.

In addition to the per-capita cap, the waiver proposed several other changes, including:

• Up to 12 months of continuous Medicaid eligibility.
• A six-month period of ineligibility if a person commits an “intentional program violation.” The waiver proposal outlines what counts as a violation, but it’s essentially fraud with the intent to receive benefits or coverage that the person would not otherwise be eligible to receive.
• Elimination of presumptive eligibility determined by a hospital.

When CMS informed Utah officials that their request for enhanced Medicaid expansion funding was not going to be approved, Gov. Herbert, Senate President Stuart Adams, and House Speaker Brad Wilson expressed their disappointment in a statement, and noted that they would continue to work on a solution for Medicaid expansion.

Utah’s “fallback plan” approved by CMS in December 2019

Although the federal government rejected Utah’s proposal to receive full federal funding for a partial Medicaid expansion, and also rejected the proposal to allow people with income above the poverty level to have a choice between Medicaid and a subsidized plan in the exchange, Utah had already outlined contingency plans earlier in 2019.

The state submitted its “fallback plan” waiver proposal to CMS in November 2019, after accepting public comments earlier in the fall. The fallback plan called for expanding Medicaid eligibility in Utah to households with income up to 138% of the poverty level (ie, what voters approved in the 2018 election), but with a work requirement as well as a lock-out period for “intentional program violations,” premiums for enrollees with income above the poverty level, a ban on presumptive eligibility determinations under Medicaid expansion guidelines, and various other provisions.

CMS granted approval in December 2019, and the new Medicaid eligibility guidelines took effect in January 2020. The work requirement provision of the waiver proposal was approved and did take effect in 2020, but it was suspended by April due to the COVID pandemic and approval for it was later withdrawn by the Biden administration.

Utah had a contingency plan in case their work requirement was rejected. In that case, Utah’s final plan, if no waiver approval had been granted by July 1, 2020, was to simply implement Medicaid expansion as called for in the ACA (and in the state’s ballot initiative), without a waiver.

The state had created an at-a-glance chart that compared the details of the bridge plan, the per capita cap plan, the fallback plan and the regular expansion plan. The Utah Department of Health has also published a chart showing enrollment over time in both the partial expansion and the full expansion program.

Very limited expansion was approved in 2017; enrollees were transitioned to expanded Medicaid in 2019

In March 2016, Utah Governor Gary Herbert signed HB437 into law, providing for a limited version of Medicaid expansion. Utah’s version was much less comprehensive than the Medicaid expansion called for in the Affordable Care Act (ACA). Utah House Majority Leader Jim Dunnigan noted that the legislation “targets those in extreme poverty.”

Instead of expanding coverage to roughly 130,000 people (as would have been the case if the state had accepted federal funding for the ACA’s version of Medicaid expansion), HB437 was expected to provide Medicaid coverage to about 9,000 – 11,000 of Utah’s poorest residents (by 2019, however, nearly 17,500 people were enrolled). The limited expansion provided Medicaid for 12 months to Utahns who are homeless, mentally ill, in need of treatment for substance abuse, or recently released from incarceration.

Utah’s limited expansion of Medicaid was slated to cost the state about $30 million a year ($13.6 million of that from hospitals in the state), and the federal government about $70 million a year. Democratic lawmakers — who felt that HB437 was “less than crumbs” — noted that full expansion of Medicaid would have cost the state $44 million a year (some estimates say $50 million), but would have brought in $420 million a year in federal funds, garnering far more value from those state dollars.

Utah submitted a Section 1115 waiver proposal (the Primary Care Network demonstration) to CMS in July 2016, but CMS quickly responded, asking for additional information and an additional public comment period. The state had planned to implement the limited Medicaid expansion proposal in January 2017, but CMS approval didn’t come until October 31, 2017.

Under the terms of the approved waiver, the state was able to begin enrolling people as of November 2017. Utah residents could qualify for up to 12 months of coverage under the Medicaid waiver if they had income of no more than 5% of the federal poverty level (that amounted to no more than $603 in 2018), and were either chronically homeless or involved in the criminal justice program, and/or in need of substance abuse treatment.

In 2019, Utah transitioned Primary Care Network enrollees to the Medicaid expansion program.

What was Utah Access Plus?

Utah Access Plus was a compromise proposal reached by Utah’s “gang of six” in 2015, after lawmakers rejected Governor Herbert’s Healthy Utah Medicaid expansion proposal during the 2015 legislative session.  If it had won legislative support, Utah Access Plus would have used Medicaid funds to purchase private coverage for eligible residents. Because it was an alternative method of expanding Medicaid, it would have also needed HHS approval in order to obtain federal funding.

The “gang of six” included then-Governor Gary Herbert, Lt. Governor Spencer Cox, Senate President Wayne Niederhauser, House Speaker Greg Hughes, House Majority Leader Jim Dunnigan and Senator Brian Shiozawa. They worked together during the summer of 2015 to flesh out the details of a plan to replace two previous proposals (Gov. Herbert’s Healthy Utah plan and the House of Representatives’ Utah Cares plan). The gang of six announced in July 2015 that they had come to an agreement on a path to Medicaid expansion, but GOP lawmakers rejected their proposal, putting the state back to square one.

Prior rejection

Governor Herbert worked for years to expand Medicaid. The House’s failure to support Utah Access Plus was the second time he had offered a proposal to lawmakers only to see it rejected. In October 2014, Herbert announced that he had come to a tentative agreement with HHS on his Healthy Utah plan that would have offered a modified, somewhat unique approach to expansion.

Governor Herbert unveiled the details of the HHS-approved Healthy Utah program at a meeting with legislators in December 2014. The proposal would have covered 126,000 Utah residents, but the legislation to implement it, SB 164, failed in committee in March 2015.

Lawmakers in the House Business and Labor Committee instead voted to recommend the Utah Cares proposal (HB 446) for further consideration. Utah Cares would have cost the state more, garnered less in federal funding, and covered fewer people with much more limited benefits. It had also not received tentative approval from HHS the way Herbert’s Healthy Utah plan had. Ultimately, neither bill advanced in the legislature during the 2015 session.

Enrollment dropped from 2016 to 2019, but increased again under expansion and the COVID pandemic

From 2013 to July 2016, total enrollment in Utah’s Medicaid/CHIP program increased by 4% (12,828 people), but by March 2019, enrollment was about 3% lower than it had been in 2013. This was despite an increased eligibility limit for low-income parents, and the limited expansion of Medicaid for homeless people with no income, which took effect in November 2017.

But enrollment in Utah’s Medicaid program is growing rapidly now that coverage has been expanded to adults with income under the poverty level. As of late 2022, it was 61% higher than it had been in 2013. This increase is due to Medicaid expansion as well as the ban on Medicaid disenrollments between March 2020 and March 2023, due to the COVID pandemic.

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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 healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.