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Alaska to support Medicaid Expansion with Executive Order

Earlier this year, the Alaska Legislature rejected Governor Bill Walker’s efforts to expand the Alaska Medicaid Expansion program through the state budget process. The Legislative season adjourned without allowing a vote on a separate Alaska Medicaid expansion bill. However keeping his promise Gov. Bill Walker said at a press conference held on July 23, 2015 he will use his executive power to expand the public Medicaid health-care program to cover as many as 40,000 low-income residents in the state of Alaska. The Medicaid Expansion in Alaska will make Alaska the 30th state to accept  the Medicaid Expansion provision that is part of the Affordable Care Act. The Expansion of Medicaid was one of Bill Walker’s campaign promise, Walker a Republican-turned-independent was elected with support of the state Democratic Party.

Walker and the Alaska republican legislature engaged in months-long battles over Medicaid expansion with the Republican-led caucuses that control the state House and Senate — a battle that has undergone over two dozen legislative hearings. In his July press conference, Walker said “I wanted to honor the process,” Walker said. “And I gave it every opportunity.”

If Alaska successfully supports the Medicaid Expansion provision of the Affordable Care Act it will add 40,000 low income individual to the programs current roster. The program currently covers an estimated 120,000 low-income children, pregnant women and people with disabilities. Walker’s move makes newly eligible about 40-42,000 more Alaskans who make less than $20,300 annually, or couples with combined incomes of less than $27,500, though only 21,000 are expected to enroll in the first year.

The state of Alaska currently spends about $640 million annually on its Medicaid program, with the total state operating budget at just over $5 billion this fiscal year. An estimated 45 percent of the 42,000 Alaskans newly eligible under expansion are employed, according to the Walker administration.

Walker notified the House-Senate budget committee of his intent to accept about $150 million in federal money to pay for the expansion. When the Alaska Legislature isn’t in session, the committee, the Legislative Budget and Audit Committee, has the authority to review requests for Alaska to accept federal money and to make recommendations.

The committee will have 45 days to consider the governor’s notice and give its advice. But it doesn’t have the authority to directly block receipt of the federal money, and Walker said at his news conference he intends to go ahead with expansion regardless of the committee’s decision. The Alaska Republican Party, has called Walker’s decision “pound-foolish,” and said in a prepared statement that he “risks bankrupting Alaska.”

What do the Alaska Medicaid Expansion Numbers says.

In June 2013 the Alaska Department of Health and Social Services (DHSS) commissioned The Lewin Group to explore the potential financial impacts of expanding or not expanding its Medicaid program. Below is a summary of the findings. Click Here for the full report.

If the state of Alaska decides not to opt for the Medicaid expansion under the ACA, Medicaid spending will still increase by $11.1 million to $39.9 million, depending on the various design options that are available. The state would also see a net reduction in spending for the Denali Kid Care program of about $6.6 million over this same period however; this would leave about 20,000 residents that are below poverty without health insurance since they would not be eligible for federal subsidies in the Health Benefit Exchanges.

If the state decides to expand Medicaid under the ACA, the state would encounter costs between $240.5 million and $305.7 million from 2014 to 2020 depending on the level of participation in the expansion. However, this would provide health insurance coverage to an additional 20,000 people in the state and provide between $2.9 and $3.7 billion in additional federal revenues to the state.

 

 

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