Delaware Mortgage Information

Before health care reform dominated debate on Capitol Hill, Delaware and several other states worked aggressively to increase the number of low-income residents covered by Medicaid, the federal-state insurance program for the poor.Now, those efforts could hurt them, sticking them with an uneven share of the bill for expanding Medicaid under one reform proposal.

The health care bill the Senate Finance Committee approved last month would expand Medicaid coverage to people earning up to 133 percent of the federal poverty level. But states such as Delaware that already have significantly increased eligibility for Medicaid would get less financial help from the federal government than states that haven't.

Under the Finance Committee bill, "expansion states" that already cover people earning at least 100 percent of the poverty level ($22,050 for a family of four), would start off in 2014 getting 10 percent less in federal assistance than other states. The differential would narrow over five years and disappear in 2019.

The 18,000 new Medicaid recipients would cost the state an additional $21 million in fiscal 2014, according to state estimates.

At a time when state governments are facing budget shortfalls, some say their states shouldn't be penalized for being progressive.

"We feel it's unfair to the states that have really gone out on a limb and expanded Medicaid coverage to more individuals," said Rosanne Mahaney, acting director of the Delaware Division of Medicaid and Medical Assistance. "It's almost punishing the states that have gone beyond what's required."

The other expansion states are Arizona, Hawaii, Maine, Maryland, Massachusetts, Minnesota, New York, Pennsylvania, Vermont, Washington, Wisconsin and the District of Columbia, according to the Finance Committee.
House bill different

Delaware would fare better under the health care bill the House passed Nov. 7. That bill would expand Medicaid eligibility to people earning up to 150 percent of the poverty level and would treat states equally in terms of federal matching payments. Those payments would cover 100 percent of expanding Medicaid eligibility in 2013 and 2014 and would cover 91 percent of expansion costs beginning in 2015.Under the House plan, the state wouldn't have to spend anything to cover an additional 24,364 Medicaid recipients for the first two years. It would spend about $11.8 million a year beginning in 2015, according to preliminary estimates.In addition, many of the childless adults that Delaware made eligible for Medicaid as part of its 1996 expansionwould be treated as newly eligible under the House bill. That means the federal government would pick up all of those costs in 2013 and 2014 -- saving the state more than $175 million each year -- and 91 percent beginning in 2015. That would not be the case under the Senate bill.

Rep. Mike Castle, R-Del., voted against the House bill, citing other reasons, including its cost.

Sen. Tom Carper, a member of the Finance Committee, voted to pass the bill Oct. 13. Though the Delaware Democrat worked extensively on shaping the legislation, he did not propose an amendment to address what he now describes as "a basic inequity."

"I don't think it was on my radar screen," he said Friday.
Meeting with Reid

However, he and Sen. Ted Kaufman, D-Del., were among 11 senators from expansion states who met recently with Senate Majority Leader Harry Reid of Nevada to seek some form of parity in whatever health care reform bill comes to the Senate floor, possibly this month.

But he acknowledged that increasing the federal match for expansion states would make it harder to pay for the health care reform bill.

"I don't expect that our states will be made whole, but we would certainly appreciate some kind of action that recognizes our early contribution," Carper said.

The meeting followed an Oct. 22 letter that 14 senators, including Carper and Kaufman, sent to Reid and two key committee chairmen asking for a boost in federal matching funds.

Reid's home state of Nevada and three others -- Michigan, Rhode Island and Oregon -- would fare well under the Finance Committee bill because of a deal Reid said he struck with the committee's chairman, Sen. Max Baucus of Montana.Those states would qualify for full federal funding for new Medicaid recipients for five years because they have lower-than-average Medicaid enrollment and unemployment of at least 12 percent."The people of Nevada are hurting, and I make absolutely no apologies, none, for helping people in my state and our nation who are hurting the most," Reid said on the Senate floor in September.

Delaware typically spends more than $500 million annually on medical assistance, according to Mahaney. The vast majority of the 170,000 people receiving assistance are on Medicaid.

In its biggest expansion of Medicaid, Delaware began covering childless uninsured adults earning up to 100 percent of the federal poverty level in 1996, according to Mahaney. Other groups earning 100 percent of the poverty level or above are also covered.

Generally, the federal government matches half the cost of Medicaid in Delaware.

Mahaney said Delaware and other expansion states want the same increase in federal funds that other states would get under congressional health care reform legislation.

"We don't think we should be punished because we're more advanced in covering more people under Medicaid than some of the other states," she said.