Bloomberg: Just How Viable an Option is the Private Option?

Bloomberg: Just How Viable an Option is the Private Option?

By Nathaniel Weixel

Medicaid expansion remains a contentious issue among governors and state legislatures, but those that have been holding out for political or economic reasons may be able to look to Arkansas for inspiration. Despite having a supermajority of Republicans in both the House and Senate, the state was able to expand coverage to Medicaid beneficiaries using a premium assistance model – the so-called “private option.” And despite a recent GAO report that called into question the methods CMS used to approve the state’s waiver, many analysts I spoke with said the private option can work elsewhere.

But the view that premium assistance can be a viable alternative isn’t held by everyone. David Machledt, a policy analyst at the National Health Law Program in Washington, told me premium assistance is more cumbersome and less cost effective than traditional Medicaid expansion. The private option “perpetuates the myth that private coverage is more cost efficient,” Machledt said. There’s also the issue of what the states are asking for when they submit a waiver plan to the federal government. Machledt said he was worried about states asking for waivers from provisions of Medicaid that are designed to protect beneficiaries. If the government agrees, in the name of getting more states on board with expansion, it sets a bad precedent, he said. Read the full article here. »

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