Utah won an unusual CMS waiver Friday to implement a partial expansion of Medicaid to adults with incomes up to 100% of the federal poverty level, starting April 1.
The waiver also allows the state to cap enrollment in the expansion program if the state lacks sufficient funds to match the federal payments. No other state has been allowed to do that.
The state will receive its standard federal match rate of about 70% for the partial expansion population, rather than the current 94% rate for a full Affordable Care Act Medicaid expansion to adults up to 138% of poverty.
The waiver's limited expansion will cover an estimated 90,000 people, compared with 150,000 under a ballot initiative approved by Utah voters in November mandating a full Medicaid expansion.
Utah Republican legislators overrode the ballot initiative last month and instead passed a skinny expansion bill including a work requirement and a cap on federal payments to the state.
Later this spring, Utah said it will submit a second waiver request to the CMS seeking to increase the federal match rate for the partial expansion to 90%, starting next year.
If the CMS agrees to pay Utah the full ACA expansion matching rate for a partial expansion, it's expected that other states will race to get the same deal. That may include states that currently have a full expansion, meaning they might eliminate Medicaid coverage for people with incomes between 100% and 138% of poverty.
The Trump administration previously has rejected full funding for partial expansions, at least partly because it is projected to cost the federal government more money. But administration officials more recently have signaled openness to the idea.
The new Utah request also will seek a cap on federal contributions, the ability to provide housing supports using Medicaid dollars, and allowing 12 months of continuous eligibility.
The idea of a federal cap is highly controversial among advocates and providers, but the Trump administration reportedly is for states to established capped models.
"This is an important first step in covering vulnerable Utahns in a financially sustainable way," Republican Gov. Gary Herbert said in a written statement.
"Governor Herbert and his team have shown tremendous leadership by developing a sustainable Utah solution that extends coverage while helping lift families from poverty instead of trapping them in public assistance," CMS Administrator Seema Verma said in a written statement.
Medicaid expansion advocates criticized the new waiver as less favorable for Utah, both fiscally and in terms of coverage, than a full expansion.
"This plan is three times more expensive than traditional Medicaid expansion and locks vulnerable Utahns out of coverage," said Matt Slonaker, executive director of the Utah Health Policy Project, which spearheaded the November expansion ballot initiative.
Eliot Fishman, senior health policy director at Families USA, said the state's work and community engagement requirement that's part of the approved waiver will depress enrollment.
"There is a lot of paperwork around the 'community engagement' that will hold enrollment down in addition to the enrollment cap," he said. "It's never an entirely bad thing of course for people to get coverage, but there is a much better deal for Utah that the voters approved last November."
Utah's Medicaid work program will operate differently than the Arkansas and Kentucky waiver programs halted by a federal judge Wednesday, explained Tom Hudachko, a spokesman for the Utah Department of Health.
Expansion enrollees will be required to fill out an online assessment that directs them to a training program. Then they will have to complete 48 job searches in the first 90 days of their Medicaid eligibility. But they won't have to report a minimum number of hours of monthly employment, as in the eight other states with CMS work requirement waivers.