Despite court’s ruling on Affordable Care Act, expect new debate in Nevada

By Kyle Roerink

Published Friday, June 26, 2015 | 2 a.m.

Updated Friday, June 26, 2015 | 10:28 a.m.

With the U.S. Supreme Court ending the latest GOP attack on the Affordable Care Act on Thursday, Nevada will now see a new wave of debate about President Barack Obama’s landmark law.

Two policy areas in the state — the growing number of Medicaid recipients and increasing the number of insured consumers — have been dwarfed by the national debate on the case but will likely emerge as hot-button issues in the coming months.

The two policies currently lack the partisan vitriol seen in the latest court case. But they will dig into the crux of what’s driven the battle over the policy since 2010: Will consumers pay more because of the law?

MEDICAID

The state’s participants in Medicaid, free health insurance for individuals making less than 138 percent of the poverty level — or $17,500 per year — has grown by more than 40 percent in the last two years with currently more than 550,000 Medicaid participants. The federal government currently covers between 65 and 100 percent of the costs for all Medicaid participants in the state. In 2017, the state will start paying 5 percent for the 180,000 people whose Medicaid is now 100 percent federally funded. By 2020, the state will pay 10 percent.

More people have been able to access Medicaid since Gov. Brian Sandoval called upon state lawmakers to expand the program to more people in the 2013 session, which allowed anyone making less than 138 percent of the federal poverty level to qualify for coverage.

That expanded access has been a positive for residents without insurance but raised concerns among lawmakers about increasing costs down the road on Nevada’s general fund.

Assemblyman James Oscarson, R-Pahrump, and chairman of the Health and Human Services Committee, said lawmakers declined to cut fees and took other measures to prepare for the increased costs during the 2015 legislative session that ended June 2.

“We have to care for those folks and they deserve to be cared for,” Oscarson said. “We just have to do it in a cost-effective manner.”

Despite lawmakers' pre-emptive measures to hold down costs, it remains to be seen how much the state will pay and how many more Nevadans will enroll in Medicaid. Those questions make it difficult to predict how much the state will have to pay once the federal guidelines kick in.

Medicaid funding for the state does not include dollars for social service programs and makes up about 7 percent of the state’s general fund. Pregnant women who are earning 165 percent of the federal poverty level also are eligible.

OTHER COSTS

More than 60,000 residents have enrolled in health care plans offered on the state’s health insurance marketplace, the Silver State Exchange. Those consumers have been a mix of people who qualify for tax credits — an incentive to sign up — and those who don’t qualify for those subsidies.

Unlike Medicaid, those consumers will pay premiums and would be subjected to out-of-pocket costs for trips to the hospital.

The maximum a person can pay for out of pocket costs — deductibles and copays — has increased in the past two years and will do so again next year.

In 2014, the max an individual could pay was $6,350. Next year it will be $6,850.

Insurance rates for the majority of plans also increased 4 to 10 percent this year. Those increasing costs have prompted questions about the cost for consumers.

“The only people benefiting from the health care law are the people on paper who can show they’re making very little money,” said Pat Casale, a Las Vegas health insurance broker.

REACTION

For Nevada, the high court’s case did not leave in limbo any of the state’s consumers. It addressed two tax credits available to eligible consumers who enroll for insurance plans purchased in exchanges created by the Affordable Care Act.

Nevada is defined as one of 14 state-based exchanges because of the way it enrolls and advertises insurance policies created by the health care law. The remaining states are considered federal exchanges.

The case, spearheaded by Republicans, suggested that the bill’s language excludes subsidies for the 6 million consumers who enrolled for health insurance plans subsidized with tax credits on the federal exchange, healthcare.gov. The court ultimately said that the language was intended to cover consumers on both state and federal exchanges.

The court's ruling, which came on a 6-3 margin, gives the health care industry a clear interpretation of the law, said Larry Harrison, a spokesman for the National Association of Health Underwriters. However, Harrison expressed concern about people bending the rules or taking advantage of loopholes to qualify for subsidies or Medicaid for which they shouldn't be eligible.

“There is always going to be contention with this bill,” he said. “It’s complex and it was very sloppily written. It was written by lawyers for lawyers.”

Sandoval released a statement on Thursday to address the ruling. He said the state's uninsured population has been cut in half and now comprises 11 percent of Nevadans, thanks to the state's implementation of the Affordable Care Act.

"Today's decision affirmed that this was the best choice for Nevada," he said.

CORRECTION: This story has been updated to correctly describe state contributions to Medicaid and its scope of services. The federal government covers between 65 and 100 percent of the costs for all Medicaid participants in the state. Medicaid funding for the state does not include dollars for social service programs and makes up about 7 percent of the state’s general fund. Pregnant women who are earning 165 percent of the federal poverty level also are eligible. | (June 26, 2015)