By Anthony Buffa:

Today was the first of several scheduled meetings of the House Michigan Competitiveness Committee on HB 4714 (Lori, R – Constantine) that would expand and reform Medicaid in Michigan.  In opening testimony, Chairman Mike Shirkey (R-Clarklake) promised a “robust, disciplined debate” and said this would be the first of many opportunities for stakeholders and private citizens to give their input and share concerns.

Rep. Mike Shirkey (R-Clarklake), Chair of the House Michigan Competitiveness Committee

 Rick Murdock, Executive Director of Michigan Association of Health Plans (MAHP) was the first to testify and explained that he was not testifying on behalf of his organization, but had been asked by Chairman Shirkey to give an overview of the current Medicaid system in Michigan given his extensive experience in that arena.

 Mr. Murdock provided an extensive defense of the state’s current system. He explained that he has heard a lot of rhetoric about widespread abuse and fraud in Medicaid, but said that most of those abuses can be found in the traditional fee-for-service system and much less so in Michigan’s managed care system. He presented graphs that showed that the share of the state budget for Medicaid spending per enrollment is actually reducing and credited that to the managed care system. Murdock concluded by saying “Medicaid is not broken” and that “our system is one of the best in the nation and saves taxpayers hundreds of millions annually.” The Chairman thanked him for his testimony before calling up the bill sponsors.

 Rep. Matt Lori (R-Constantine) and Rep. Al Pscholka (R–Stevensville) were the next to testify before the committee. Lori stressed that we need to promote healthy lifestyles if we are going to combat the rising cost of health care in the country and that this legislation was very important to him personally, as he hopes the Legislature avoids another “oops moment” where an opportunity to reform passes them by. He said the bill would allow non-disabled adults (aged 21 to 64) with an annual income level up to 133% of federal poverty guidelines to enroll in Medicaid for a maximum of 48 months. The bill is dependent on the Department of Community Health (DCH) obtaining a waiver from the U.S. Department of Health and Human Services concerning this 48 month cap.

 When Chair Shirkey opened up the committee for questions for the bill sponsors, there was concern from several legislators (including Reps. Tom Leonard (R-DeWitt), Kate Segal (D-Battle Creek, and Jim Townsend (D-Royal Oak)) about the state actually receiving the waiver from the federal government. Lori said, in his opinion, there is a “good chance” Michigan would receive the waiver and that he actually wanted nothing to do with Medicaid expansion until the idea for the waiver was floated around. Rep. Gail Haines (R-Waterford), citing her experience as chair of the House Health Policy Committee, questioned if the Centers for Medicare and Medicaid Services (CMS) even had the authority to issue the waiver to which Rep. Lori suggested sending top Michigan legislators to Washington and not letting them come back until they had a straight answer.

Rep. Matt Lori (R-Constantine), Sponsor of HB 4714

Two other issues were specifically brought up at different points during the hearing by a number of different legislators. Rep. Andy Schor (D–Lansing) and Rep. Segal pressed the bill sponsors for the language concerning “able bodied adults.” They expressed concerned that someone who was not physically disabled might not qualify, even though they are unable to work for other health reasons (i.e., cancer, etc.). The bill sponsors acknowledged that the language could be cleaned up to make it less ambiguous, but stressed that the point of the legislation was not to punish people who can’t work for health-related reasons. There was also a lot of interest in the 48-month cap with Rep. Segal flat out asked what the basis was for that time limit. Lori acknowledged that they had debated between a 48-month and a 60-month cap before settling on 48 months. He said it is similar to caps in other federal programs (i.e., federal housing projects) that “are aimed at helping an individual through a tough time as opposed to providing a lifestyle.”

 The House Michigan Competitiveness Committee is scheduled to continue testimony on HB 4714 and Medicaid expansion this Thursday, May 18.  Wiener Associates will continue to provide updates as legislators discuss Medicaid expansion. To view the complete text of HB 4714 and the House Fiscal Agency analysis, please visit the Wiener Associates blog post linked here.