Officials said covering 95,000 more won't cost state, but could take until October.
Minnesota can add 95,000 low-income adults to its Medicaid rolls, vastly improving their medical care, at no additional cost to the state, two officials at the state Department of Human Services told legislators Tuesday.
That's because the federal government would pick up roughly half the cost of their care under Medicaid, while thousands of them now use skimpier programs funded by the state. The testimony contradicts assertions by Gov. Tim Pawlenty that moving those patients into the state-federal Medicaid program -- allowed under the new federal health care law -- would cost Minnesota $431 million over the next three years. Pawlenty cited the cost last spring in opposing the shift.
Bruce Gordon, a spokesman for Pawlenty, said on Tuesday that the governor's cost estimate was based on reports from the Minnesota Management and Budget office, most recently last month. "I can't explain why [the two Human Services officials] have an opinion that contradicts MMB's official budget forecast," he said. The Medicaid shift will occur after Mark Dayton becomes governor Jan. 3 and signs an executive order, something Pawlenty has refused to do.
The bad news for those patients, said Medicaid director Brian Osberg, is that moving them to Medicaid may not start until Oct. 1. He said the state must first make massive programming and other changes to two computer systems that don't talk with each other. He said employees may have to enter about 50,000 records by hand, even though his department can identify at least 84,000 individuals on two state health programs right now who will qualify for Medicaid.
Advocates for patients and health providers said they were shocked by the projected delay, which they had thought might amount to only a few months.
"You could hear the groans in the audience," said Mary Krinkie, a vice president of the Minnesota Hospital Association, who attended the hearing where Osberg testified. "This is just plain bad news,'' she said. "There's got to be some way to speed this up."
Rep. Tom Huntley, DFL-Duluth, who conducted the hearing, agreed. "Maybe we need to get a consultant in here to help out," he suggested. "There are a lot of people not getting the care they should to keep them healthy, and it's going to take nine months to fix it? We need to do better."
Osberg said in an interview later that his department is "taking a second look to see if there's some way to shorten the time, maybe sacrificing something else in our workload."
States like Minnesota were given the option for an early expansion of Medicaid under the big federal health bill of 2010, and last year's Legislature placed that decision in the hands of the governor who would take office in January 2011.
Moving to Medicaid would be about 32,000 patients now using General Assistance Medical Care (GAMC), a state program now based only at four Twin Cities hospitals, and 51,000 now on MinnesotaCare, an insurance plan for low-income working people.
Medicaid has a more generous benefits set than either state program. In addition, about 12,000 people not in any program would qualify, Osberg said.
Minnesota's savings from moving people from the two state health programs will offset the state's roughly $500 million a year cost of matching federal payments for Medicaid, said George Hoffman, the department's director of reports and forecasts.
That would be true if it includes just those earning no more than 75 percent of poverty ($8,100 a year), as the state law specifies, or those earning up to 133 percent of poverty, as the federal law would allow, Hoffman said.
Warren Wolfe • 612-673-7253