The Montana Capitol (Photo by Darrell Ehrlick of the Daily Montanan).
Lawmakers on the health and human services budget committee on Wednesday heard opposing presentations about Medicaid expansion in Montana and its purported benefits and drawbacks as the legislature sets up what will likely be one of its biggest decisions next year – whether it should continue the expanded Medicaid program or let it expire next June.
Under Medicaid expansion, which was created under the Affordable Care Act, able-bodied adults earning up to 138% of the Federal Poverty Level – around $20,782 annually this year for a single person – can get health insurance coverage paid for primarily by the federal government, but partially the state. As of June in Montana, there were around 81,000 people covered under expanded Medicaid out of a total of 228,000 covered by the overall program. Medicaid covers about one-fifth of Montana’s population.
That’s down from a peak of around 302,000 Montanans who were covered in June last year as the state started its unwinding process to boot people off the program who had automatically been re-enrolled during the COVID-19 federal emergency but were no longer eligible after the emergency ended.
Montana first expanded Medicaid here in 2015 and renewed the expansion in 2019. But the expanded portion of the program will expire in June if lawmakers choose not to renew it again during the 2025 legislative session that starts in January and will run for as long as 90 days.
Only 10 states have not expanded Medicaid coverage in the decade they have had the option.
The topic of expansion is sure to bring dozens of lobbyists, health care workers and officials, and people covered by expanded Medicaid to the Capitol to offer their viewpoints on what is currently a $2.4 billion program in Montana overall, with about $100 million annually initially coming out of the state’s General Fund for the expanded coverage. Nearly 80% of the Montana Medicaid budget is paid for with federal funds, and states receive a 90% match for funds for the expanded population.
Medicaid enrollment in 2022 as a percentage of each Montana county’s population. (Source: Montana Healthcare Foundation)
Wednesday’s presentations offered starkly different viewpoints on the expanded portion. The first came from the data and analytics director of the Foundation for Government Accountability, a right-leaning think tank whose goals include stopping Medicaid expansion, and from the president of Paragon Health Institute, who was a special assistant for economic policy to former President Donald Trump.
The second came from two officials with policy firm Manatt Health, who outlined for lawmakers a report it compiled for the Montana Healthcare Foundation, a private foundation that works on health policy, that showed the benefits of Medicaid expansion in Montana for the past nine years.
Presenters say Medicaid keeping people from working, costing hospitals
The presentations from the former group by Hayden Dublois, the data and analytics director for the Foundation for Government Accountability, and Brian Blase, the president of Paragon, focused primarily on their contention that Medicaid expansion has ballooned the coverage pool beyond what was initially expected, benefited the health care industry over patients, put resources toward able-bodied adults instead of children and people with disabilities, and allowed people who are covered not to work.
Dublois said a public records request he submitted to the Montana Department of Public Health and Human Services for information on how many Medicaid recipients in Montana were working between 2019 and 2022. He claimed the data he received showed 54% of recipients in 2019 showed no earned income and that the number had jumped to 72% in 2022. The Manatt presentation would later on claim 66% of recipients were working and another 11% in school.
A slide from the Paragon presentation alleging expansion populations are costing more than forecast. (Source: Paragon Health Institute)
He said Montana’s slight dip from 23rd healthiest state in the nation in 2015 to 24th healthiest, according to United Health Foundation data, meant that claims that Medicaid helped bolster public health were not true.
And he lamented that Montana hospital profits had decreased after Medicaid expansion due in part to reimbursement rates under expansion and to costs rising during a six-year period despite the state and federal government spending double what it had originally planned to for expansion because more people were eligible than expected.
“Montana’s relative ranking in health outcomes has dropped and the preponderance of the research has shown that in rural areas in particular, outcomes are either nonexistent in terms of improvement or actually result in worsened outcomes than was expected,” Dublois said. “Hospitals are still under financial strain because cost increases outweighed the revenue gains post-expansion. Spending is up and enrollment is up.”
Blase gave a similar presentation, lamenting what he said was an overly costly expansion program that cost other Medicaid recipients quality care and saying there was “no health benefit” associated with Medicaid expansion. He, like Dublois, suggested that the expansion population would be better off getting private insurance or insurance from the ACA marketplace.
“If Montana were to not have Medicaid expansion, the people above 100% of the poverty line, they would move to the exchanges; they would qualify for a very large premium tax credit,” he said. “…So you would have a loss in Medicaid but you would have a significant increase in both private coverage as well as in employer coverage because some of those individuals who are on Medicaid would otherwise be on an employer plan.”
In response to a question from Sen. Carl Glimm, R-Kila, about what population he estimated would fall into that category, Hayden said while he hadn’t looked deeply at data, he believed roughly 20,000 to 30,000 might be eligible for what he called “enhanced private exchange coverage.”
Other group says expanded Medicaid benefitting Montana
The presentation from Manatt Health senior managing director Patti Boozang and senior adviser Zoe Barnard essentially took the opposite stance and highlighted what the two said were vast benefits to Medicaid expansion in Montana and other states during the past decade.
A slide from the Manatt Health presentation showing Medicaid costs and the share paid by each entity. (Source: Manatt Health/Montana Healthcare Foundation)
“We’ve had expansion in place for quite a long time now, and there has been a lot of research, a lot of academic studies looking at the impact of Medicaid expansion on coverage, on access, on outcomes,” Boozang told the committee. “And I think the punchline here is that the overwhelming evidence is what Medicaid expansion has had positive effects on all of those measures of success or what we care about in our healthcare system and in our coverage programs.”
She pointed out that spending per Medicaid enrollee in all expansion states is higher for all Medicaid-eligible groups than in non-expansion states, that states have increasingly expanded Medicaid during the past seven years, including seven states by ballot initiative, and that most studies show expansion has positive overall effects for providers, users and states while lowering uncompensated care costs for hospitals.
Barnard told the budget committee that the expanded Medicaid program in Montana has reduced the uninsured rate by 30%, from 16.4% in 2015 to 11.4% in 2022, by filling the gap for people who would not typically qualify for Medicaid or employer-sponsored insurance.
Rep. Mary Caferro, D-Helena, noted that someone working on Montana’s minimum wage would make around $1,000 more annually than the 138% of the Federal Poverty Level and would not qualify even under expansion.
“I know you didn’t ask that, but I thought it might be useful,” she told the committee chair.
Barnard said Medicaid costs in 2023 were $2.4 billion, of which about 79% was funded by the federal government, 13% by the state General Fund, and 8% by special revenue funds. She said Medicaid expansion costs about $100 million a year, but about 25% is paid by hospitals.
But the state has since 2015 spent an average of 13% of the General Fund on Medicaid each year, Barnard said, meaning overall spending has only fluctuated by about $40,000 between 2015 and 2022.
She said expansion has reduced the cost of uncompensated care for Montana hospitals by about $150 million during the course of seven years. And she said Medicaid expansion has increased access to preventative care and behavioral health services.
Discussing the work requirement portion that has been part of the Medicaid expansion discussion in Montana for years, including a Senate bill that was shot down during the 2023 session, Barnard said a University of Montana economist’s analysis showed Medicaid did not decrease the labor force participation and that around 80% of adults receiving Medicaid are working or in school.
U.S. Bureau of Labor and Statistics data show Montana’s labor force participation rate was about 63.5% in 2015 and is currently around 62.9%. A poll released in early May found nearly three-in-four Montanans supported keeping expanded Medicaid.
“Montanans need to understand that expansion is not a government program keeping people form working,” Barnard said.