The state reached an agreement with the federal government on a three-year extension of a Medicaid waiver needed to provide critical funding for the state’s landmark health care law.
People close to the negotiations told the Associated Press on Tuesday that the agreement secures billions of dollars more in spending authority for the state over the previous waiver and preserves eligibility and benefit levels.
The waiver allows Massachusetts to bypass rules about spending its federal money for Medicaid, a state- and federally-funded program that provides health care assistance to low-income people. The state needs the waiver to continue using federal money as it shifts coverage from free emergency room care for the uninsured to a mix of private and government-sponsored insurance for all workers.
The federal payments were set to expire June 30, but Massachusetts received a series of extensions to continue negotiations.
Under the deal, overall spending over three years will jump by $4.3 billion over the previous three-year agreement to $21.2 billion, according to people with knowledge of the agreement who requested anonymity because it had not been formally announced.
The deal also allows the state to continue to offer subsidized health plans under the Commonwealth Care program to adults earning three times the federal poverty level. Children enrolled in the Children’s Health Insurance Program whose families earn up to three times the poverty level also will be covered.
Federal negotiators had hoped to drop the eligibility level to two times the federal poverty level.
The agreement comes as Massachusetts continues to see increases in the number of insured residents as it works toward near-universal coverage under the law. Between Jan. 1 and March 31, those with insurance increased from 340,000 to 439,000.
A total of 191,000 people have gotten private insurance since the law took effect in June 2006. Another 176,000 purchased subsidized insurance, while 72,000 have been insured through government programs.
The deal is the result of intense negotiations between the state and federal officials.
Massachusetts Sen. Edward M. Kennedy and Gov. Deval Patrick met with Health and Human Services Secretary Michael Leavitt in February and talks continued through the year. Kennedy spoke with Patrick on Sept. 21 to discuss the deal and then with Leavitt on Sept. 24 to make a final push.
Massachusetts has been granted waivers from Medicaid rules in order to expand assistance to residents who wouldn't otherwise be eligible for coverage. But federal rules require than any expanded coverage not cost more than would have been spent without the waivers. More »