Beshear criticizes Bevin for his plans to abolish Kynect and cut back Medicaid expansion, says expansion is paying for itself

Democratic Gov. Steve Beshear “sharply criticized” Republican gubernatorial nominee Matt Bevin for his plans to eliminate the Kynect insurance exchange and scale back the Medicaid expansion if he is elected Kentucky’s next governor Nov. 3.

Beshear spoke at an event in Lexington to promote open enrollment in Kynect’s subsidized plans, which begins Nov. 1, John Cheves reports for the Lexington Herald-Leader.

“Anybody who today talks about dismantling Kynect and talks about repealing expanded Medicaid, they don’t know what they’re talking about,” said Beshear, who created the exchange and the expansion. “They’re ignoring the facts. They’re playing political games with the lives of our people. And I think on Nov. 3, the people of Kentucky are gonna rise up against that kind of — stuff. And I said ‘stuff.’ I was starting to say something else.”

In response, Bevin’s campaign told Cheves, “Jack Conway wants to keep Obamacare going even though it is breaking down before our eyes. Our state cannot afford another four years of failed liberal policies. A vote for Jack Conway is a vote for more of the same political games that got us in this mess.”

After the implementation of the Patient Protection and Affordable Care Act, Beshear expanded Medicaid to include people in households with incomes up to 138 percent of the poverty line, which is $33,465 for a family of four.

Since the expansion, Kentucky has seen the nation’s greatest drop in uninsured rates, to 9 percent during the first half of 2015 from 20.4 percent in 2013, according to The Gallup Organization, with the U.S. Census Bureau reporting an even lower uninsured rate of 8.5 percent, More than 400,000 Kentuckians are covered by the expansion, which has also caused a huge decrease in uncompensated hospital care, dropping to $83 million in the last quarter of the year from a high of $288 million about a year ago.

“But the improvement hasn’t come cheap,” Cheves writes, noting that most of the newly insured are on taxpayer-funded Medicaid and not on private plans. The federal government pays the entire cost of the expansion through next year. In 2017, the states begin to pay 5 percent, rising in steps to the federal health-reform law’s cap of 10 percent in 2020.

“Kentucky’s share could reach a cumulative $923 million, according to a report issued in February by Deloitte, a consulting firm,” Cheves notes. This report also says that Medicaid expansion will pay for itself through 2020 by creating health-care jobs and generating tax revenue. Bevin has called that “nonsense,” but Beshear countered him on that, too, saying “Right now, it is paying for itself.”

Bevin called the study “bogus” on KET Monday night, in his last debate with Conway. “It assumes, among other things, that there’s not a collapse of — oh, I don’t know — the Kentucky Health Cooperative, which has 50-plus percent of the people who are participating in the actual qualified health plans” sold on Kynect.

Kentucky Health News asked Bevin after the debate what the co-op’s problems had to with Medicaid, since they have no financial connection. He turned the question to the losses of the cooperative, calling its federal loans “our money.”

A connection could be made with the co-op’s failure and Kynect because it could have a long-term impact on Kynect policyholders, since co-op customers are less healthy and the other insurers will have to pick them up. However, next year’s penalty for not having insurance could encourage more healthy people to enroll.

The annual fee for not having insurance in 2016 is $695 per person and $347.50 per child, per year, or 2.5 percent of household income, whichever is greater, with a family maximum of $2,085.

The cooperative, a non-profit insurer, announced this month that it will close Dec. 31. It blamed Republican spending restrictions put into place last December that barred the Obama administration from using other federal funds to make up shortfalls of the 23 state co-ops. The Kentucky co-op was hoping for $77 million in extra federal money and got $9.7 million. The money was designed to compensate insurers who enrolled a disproportionate share of sick, expensive policyholders.

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