Who is eligible
Adults with income up to 138 percent of FPL are eligible for Medicaid. Children in households with incomes up to 319% of FPL are eligible for Medicaid or CHIP.
- healthinsurance.org contributor
- January 9, 2017
Although Pennsylvania was a year behind many other states, expanded Medicaid took effect January 1, 2015. Eligible enrollees were able to apply starting December 1, 2014. In the first two days of enrollment, 41,500 Pennsylvania residents applied for Healthy Pennsylvania coverage.
In 2015, the state transitioned away from the modified expansion that was approved in 2014, and instead implemented straight Medicaid expansion as called for in the Affordable Care Act (ACA). By July 27, 2015, 439,000 people had enrolled in Pennsylvania’s expanded Medicaid program.By April 2016, that number had grown to 625,000. And by January 2017, there were 670,000 people in Pennsylvania who were covered by Medicaid as a result of the expansion. Prior to expansion, the state had estimated that about 680,000 people would be newly eligible for coverage if the state were to expand coverage.
The ACA (including expanded Medicaid) under the Trump Administration
Republicans in Congress have begun the process of repealing the ACA, although they’ve said that consumer benefits (like Medicaid expansion) won’t be repealed immediately. The likely time horizon is two to four years before the ACA is fully repealed and replaced with something new. The details of that something new are still not clear, however. You can follow the situation in our Repeal & Replace section, but it’s likely to be a long process.
House Republicans have proposed block grants or per-capita allotments for Medicaid funding under their replacement for the ACA, but consumer advocates worry that either solution would result in states receiving less federal funding for Medicaid. That, in turn, would result in states having to restrict eligibility and/or reduce benefits.
Pennsylvania’s two Senators — Democrat, Bob Casey and Republican, Pat Toomey — are at odds over the ACA. Casey is working to protect the law (including Medicaid expansion) while Toomey is among the Republican Senators calling for its repeal.
Medicaid expansion — which is a cornerstone of the ACA — has played a significant role in the declining uninsured rate in Pennsylvania (according to U.S. Census data, the uninsured rate fell from 9.7 percent in 2013 to 6.4 percent in 2015; it has likely continued to fall since then). The state’s Medicaid expansion covers 670,000 people as of early 2017 (this was reported as 680,000 in December 2016, but the number is always in flux as people enter and leave the Medicaid system), many of whom would not be able to afford coverage if Medicaid weren’t available.
Despite the fact that Medicaid expansion didn’t take effect until 2015, uncompensated care costs at Pennsylvania hospitals dropped 8.6 percent in fiscal year 2015, which ended when Medicaid expansion had only been in effect for six months (uncompensated care includes charity care and uncollected patient debt; in states that have expanded Medicaid, uncompensated care has declined, while states have haven’t expanded Medicaid have seen no significant change in their uncompensated care costs).
Expanded Medicaid in 2015
Originally, the ACA provided for expanding Medicaid to cover everyone with household incomes up to 138 percent of poverty in every state. Then in 2012, the Supreme Court ruled that states could not be penalized for choosing to not expand Medicaid, and 19 states have not yet changed the eligibility guidelines for their Medicaid programs.
Most of the states that have expanded their coverage did so with an effective date of January 1, 2014. Pennsylvania, however, initially took a unique approach to Medicaid expansion and the approval process was lengthy. Former Governor Tom Corbett spent a year pitching his Healthy Pennsylvania program to CMS. Although he was forced to make several concessions along the way, the program received CMS approval on August 28, 2014, making Pennsylvania the 28th state to expand Medicaid.
However, in the 2014 election, Corbett lost to Democratic challenger Tom Wolf, who has long been an advocate of full Medicaid expansion under the ACA. Wolf indicated that he would not use the Healthy Pennsylvania model, and would instead expand Medicaid with no modifications.
If Pennsylvania had not opted to expand Medicaid, the state would have lost out on $37.8 billion in federal funding over the next ten years.
Transition to HealthChoices
Governor Wolf wasted no time in starting the process of switching to a more simplified version of Medicaid expansion. By April 2015, the transition had begun, and the first round of enrollees had their coverage switched to HealthChoices as of June 1. This includes everyone who was already covered by Pennsylvania Medicaid prior to January, as well as new applicants who enrolled after the end of April. The remaining enrollees switched to HealthChoices on September 1, 2015.
In the transition to HealthChoices, people who enrolled in a managed care plan through Healthy PA’s Private Coverage Option were given a choice of managed care providers in the HealthChoices program. But while Healthy PA had three different plan designs, HealthChoices provides all enrollees with the same benefits, and should reduce confusion in the state’s Medicaid system.
The state created a 60 second video clip explaining the transition from Healthy PA to HealthChoices.
From a waiver to straight expansion
Former Governor Corbett originally announced that the state would not move forward with Medicaid expansion, but reversed his course in late summer 2013, saying that the state was negotiating with the federal government to create its own version of Medicaid expansion (Healthy Pennsylvania), using the federal funds to subsidize private health insurance for low-income residents instead of enrolling them in Medicaid, and adding restrictions that would remove some people from Medicaid or charge them a “modest monthly premium” (which he initially proposed to mean that people with incomes above 50% of poverty level would end up paying for their coverage).
Corbett’s plan was very controversial in Pennsylvania, among lawmakers and residents alike. On March 5, 2014, a letter from Corbett to Sec. Sebelius outlined his loosening of the requirement that Medicaid recipients be actively searching for work, but his proposal did still include a work requirement. Ultimately, the work requirement was dropped from the Healthy Pennsylvania program, but the state established a voluntary job training and career coaching program (dubbed Encouraging Employment) that could let participating enrollees have lower cost sharing.
Under Corbett’s plan, no premiums would be charged for Healthy Pennsylvania in 2015, but starting in 2016 the program would have charged up to two percent of income for enrollees with incomes between 100 percent and 138 percent of poverty level (enrollees would have been able to qualify for premium reductions if they completed an annual wellness exam and paid required co-payments in a timely manner). In addition, Healthy PA had three different plan designs depending on health status and eligibility, as opposed to a single Medicaid system for all enrollees
In June 2014, the Corbett Administration had received a strong response from insurance carriers interested in participating in his Healthy PA program: For some regions of the state, as many as six insurers had placed bids, while the Administration had been hoping for at least two per region. In all, nine insurers were approved by the state to participate in the Healthy PA program that was approved by HHS in late August 2014.
Through these private insurers, newly-eligible Healthy Pennsylvania enrollees were covered under a private, managed care Medicaid program – very similar to what Pennsylvania and many other states already use for existing Medicaid coverage. Although by early October, there were some indications that the carriers providing the managed care Medicaid coverage were having difficulty getting enough providers to participate in their networks because of the relatively low reimbursement rates compared with commercial plans.
But the complicated waiver-sanctioned Medicaid expansion program in Pennsylvania was short-lived, and the process of dismantling it began almost as soon as Healthy PA coverage started to become effective. When Governor Wolf took office in 2015, he began the process of switching the state to the much less complicated Medicaid expansion program outlined in the ACA — no waivers required.
New eligibility guidelines took effect in 2015
Since January 1, 2015, all legally present adults in the Commonwealth of Pennsylvania – parents or not – are eligible for Medicaid with household incomes up to 138 percent of poverty, as long as they meet Medicaid’s immigration requirements. Children are still eligible for Medicaid or CHIP if their household income doesn’t exceed 319 percent of poverty level.
Expanded Medicaid enrollment began December 1, 2014
Enrollment in the Healthy Pennsylvania program began December 1, 2014, for coverage effective January 1, 2015. Enrollment in Medicaid continues year-round. There are multiple ways to apply:
- online, at COMPASS.state.pa.us
- by phone, at 1-866-550-4355
- in person or with a paper application (English, Spanish) at your local County Assistance Office
People who qualify for Medicaid under the pre-expansion guidelines can use those same application methods to enroll in Medicaid during 2014.
If you have questions about the Healthy Pennsylvania program or about the new HealthChoices program, you can email them to RA-PWDHSMEDICAIDFAQ@pa.gov.
Closing the coverage gap in Pennsylvania
For adults, the change in eligibility rules were particularly beneficial for those with household incomes below 100 percent of poverty. In 2014, approximately 281,290 Pennsylvania residents – roughly a quarter of the state’s uninsured adult population – were in the coverage gap and had no realistic access to health insurance. That changed in 2015 when Medicaid became available for them.
The coverage gap exists because the ACA’s premium tax credits are only available for households with incomes between 100 percent and 400 percent of poverty level. The expectation was that everyone below that level would have Medicaid.
But in states where Medicaid has not been expanded, people with incomes below the poverty level simply receive no assistance at all with their health coverage. They are not eligible for Medicaid, and they’re also not eligible for premium subsidies. Their only option is to purchase full-price health insurance, which isn’t practical for most people living on incomes below the poverty level.
Pennsylvania’s total Medicaid enrollment reached 2,880,702 by July 2016, an overall increase of 21 percent since the fall of 2013. Virtually all of that increase has come since the beginning of 2015, when Medicaid expansion took effect in Pennsylvania.