The federal government, in its effort to promote states' expansion of Medicaid under the health reform law, is likely to benefit insurers as well. That's because the most recent movement in Medicaid expansion is for states to hire private insurers to administer their programs.
Arkansas started the recent trend, proposing to use federal dollars provided under the reform law to pay private insurers to insure the expanded Medicaid population. Ohio and Virginia officials have also signaled interest in a private Medicaid expansion option.
It appears that the U.S. Department of Health & Human Services just might approve this GOP-led idea. HHS officials gave the go-ahead to the Arkansas and Ohio governors, granting them tentative approval of the private option, reported Stateline.
"It's a potential turning point for states that are on the fence" about expanding Medicaid, said Matt Salo, director of the National Association of Medicaid Directors. "If Arkansas and Ohio can find a path through this thicket, it could give a lot of other states that have either said 'No' or are on the fence a reason to think again."
If officials in Arkansas and Ohio can forge ahead to pay private insurers to run Medicaid, Louisiana, Florida and Texas might not be far behind. The new "no, but …" option, as an Associated Press article referred to it, lets Republican officials and lawmakers take federal money without completely breaking from the party's overall opposition to health reform.
One key question, though, is how much money states can funnel to private insurers to run Medicaid. HHS Secretary Kathleen Sebelius has said the agency will provide more details on that issue "in the very near future," NPR's Shots reported.