Ohio Gov. John Kasich, defending his Medicaid expansion as he runs for president, can point to lower-than-expected costs

John Kasich campaigned in Derry, N.H. (Associated Press photo by Jim Cole)

By Al Cross
Kentucky Health News

Expanded eligibility for Medicaid, an issue in the Kentucky governor’s race, is one of the major topics that separate Ohio Gov. John Kasich from his competition in the race for the Republican nomination for president. Like Democratic Gov. Steve Beshear, Kasich used the federal health-reform law to give Medicaid to households with annual income up to 138 percent of the poverty level.

Both states’ enrollment of the newly eligible was higher than expected, adding to critics’ concern that the expansions are a ticking time bomb for state budgets. States have to start paying 5 percent of the expansion cost in 2017, rising gradually to the law’s limit of 10 percent in 2020. Advocates say increased tax revenue from a larger health-care industry will cover the cost, at least for a while.

Last week, Kasich’s administration reported that Ohio’s total Medicaid spending in the fiscal year that ended June 30 was 7.6 percent less than expected, despite the higher-than-expected enrollment. “Medicaid Director John McCarthy said savings have been achieved through expanded home-based care
for seniors, shorter nursing-home stays, expanded managed care, capitated reimbursement policies —
pay per patient rather than per patient visit — and other cost-controlling efforts,” Catherine Candisky reports for The Columbus Dispatch.

Kentucky officials have pointed to capitated managed care, adopted statewide in November 2011, as the main reason Kentucky’s Medicaid expenses have been lower than projected. However, health-care providers complain of slow payment, no payment and unfair treatment by managed-care companies.

Ohio’s expansion added more than 500,000 people to the Medicaid rolls, bringing total enrollment to near 3 million. That is about 25 percent of the state’s population of 11.6 million. Kentucky’s expansion added about 430,000, currently about 400,000. About 1.2 million Kentuckians are on Medicaid, representing about 27 percent of the state’s population of 4.4 million.

While Kasich and a few other Republican governors have used the reform law to expand Medicaid, he says that if elected president he would move to replace the law with something better. “The ‘repeal’ position is essential for Kasich,” writes Chrissie Thompson of The Cincinnati Enquirer. “Kasich had to defend his Medicaid move in his first question in the prime-time debate” among top-tier GOP candidates.

“Kasich has insisted he wouldn’t cut back on the expansion of Medicaid to
more low-income Americans,” Thompson reports. “Instead, he says, he’d want to send the
federal money back to states, with more freedoms on how to implement the
program.” Also, “He’s all but said he’d scrap the controversial (and, thus, delayed)
mandate that businesses with at least 50 employees provide coverage for
their full-time employees. . . . From there, it gets a little vague, except for Kasich’s clear discomfort with the idea of mandating just about anything.” (Read more)