Interview with Senator Ryan A. Silvey

Special Note: AARP in Missouri interviewed State Senator Ryan A. Silvey (R-17) on Tuesday, April 22, 2014 in his capitol office. This was an opportunity for Sen. Silvey to share his much discussed thoughts about Medicaid reform and the possibility of Medicaid expansion in Missouri.

AARP is a nonprofit, nonpartisan organization and does not endorse candidates for office or make contributions to political campaigns or candidates.

AARP: You were interviewed on the “Politically Speaking” program where you described the Budget Protection Fund. Tell us more about that.

Silvey: I think I've figured out a way to make it so that the state isn't on the hook for that match.  There are two parts to it. The first part is there are currently a number of populations that we provide Medicaid at a 60/40 match - we (Missouri) put in 40, the Feds put in 60.  Some of those populations, if we were to expand the access to coverage up to 138%, would be able to shift to the new coverage, which is a 90/10 match. That means the State would put in 10, the Feds would put in 90.  That's what it phases into – it actually is 100% up front and then it kind of phases down to 90/10.  But at the end of that, it's 90/10, whereas today, it's 60/40.

For those populations that we can shift, those are monies that are already being spent on Medicaid that we could put into what I call the Budget Protection Fund or the Taxpayer Protection Fund.  It would begin accruing a balance of money that we're already spending on Medicaid today.  Instead of spending it in other parts of the budget or using it on other programs, we would just keep it in this fund for the use of Medicaid in the future.

Over several years, the projections on that fund begins to accumulate, I think within 5 years, it's got a balance of about $600 million or so.  And when the State has to start paying its match to the Federal government, that's where we would go to pay the match fund.  It's money that we're spending today on Medicaid that we're going to spending next year or thereafter – if we don't do anything, we're spending that money anyway.  That's the first part of it.

But the second part is really the most important part to me.  I wanted a backstop in case the projections were wrong.  Because anytime you build something based on projections, if the numbers are off, you could get yourself into a bad situation.  So, if there's ever a year where there's not enough money in that fund to cover the  Federal match cost, it would automatically trigger a reduction in rates to the providers and so what the State pays the Medicaid providers would be cut and those funds would then pay the match rate.  It's money that we're already spending, but instead of going to providers, it would go to the Federal government.

My thinking about this was the Medicaid providers – the hospitals, the FQHCs – they're the ones that stand to benefit financially from expanding access to coverage to 138% because it would decrease their uncompensated care.  If they are the ones that benefit financially, I think they are the ones that should have to pay the match, not the State taxpayers, and that's why we've put that backstop in the fund.

AARP: How will your plan assure people get the health care coverage they need?

Silvey: There are a number of aspects to it. There's reform of the current system, so the people who are currently on Medicaid, I believe, will get better service under the plan by expanding the managed care model statewide, instead of just across the I-70 corridor.

The other part of the plan is it would increase eligibility up to 138%.  Right now, because of Obamacare law, you have a Federal mandate that says you have to have insurance. If you're in Missouri, under 18% of the poverty level, you're automatically on Medicaid, so you're covered – you meet the mandate.  If you're 139% to 400% of poverty, you get Federal premium assistance to help you through the exchange market to get that coverage.  If you're between 19% and 138%, you have no assistance from the State or the Federal government, but you're still required by the Federal law to carry that insurance.

The law has created a fundamentally unfair donut hole for Missourians in the middle who have nowhere to go for assistance to make sure that they don't violate the Federal law and not have insurance and get fined.  This plan addresses that by expanding that coverage to 138%.  Up to 100% would be through managed care models and between 100% and 138%, and it would be premium assistance into the private insurance market.  For people over 138%, similar to Arkansas, Iowa, Indiana and Pennsylvania, we would use those Federal dollars to provide premium assistance.

AARP: Why is it important to provide coverage for low-income individuals?

Silvey: There are a number of reasons.  First of all, as I mentioned in the last question, there's a fundamental fairness issue where the Federal government is requiring those Missourians to carry insurance and we help those poorer than them and we help those wealthier than them.  That's an important part.

Providing that coverage also decreases the uncompensated care because the U.S. Supreme Court has ruled that no one can be denied access to health care in an emergency situation.  What happens is those who don't have coverage go to the emergency room and they get treated there.  If they have no ability to pay, they have no coverage, the hospitals basically have to write off that expense and then they make up for that by increasing the cost of other services to those of us that do have coverage. That results in premium increases for everyone.

By providing some sort of access to coverage, ideally, will decrease the amount of uncompensated care and help keep the costs reasonable for the rest of us that are already paying insurance.  And then, of course, you get the benefits of, obviously, getting people the help that they need – the preventative maintenance services, for instance, so that they're able to see a doctor throughout the course of their health care as opposed to waiting until it gets really bad before seeking help and then, at that point, it's always more expensive as well.

AARP: What will this mean for low-income individuals 50 and older? Medicare engages when people turn 65 unless they are disabled – so Medicare might begin earlier.

Silvey: Simply, if you were below 138% of the poverty level and in that population, this would help you provide access, basically as a bridge to Medicare.  Once you hit that age, Medicare takes over and not Medicaid.  It would help address the donut hole situation and really that's for all populations within that poverty range.  It's not just those over 55, but certainly, I would have to think that the insurance market for that age population through the exchange is probably more expensive to begin with, and so having some sort of premium assistance would be helpful.

AARP: Do you have any additional thoughts or comments you’d like to add?

Silvey: Yeah, there are a number of states around the country that have started trying to address these problems in a way that we are looking at doing.  We get resistance – and I get resistance from some people who say the Obamacare law is bad and we shouldn't do anything to assist that, we should resist anything that comes out of that law.

I'm a big believer that we are elected to solve problems, whether they're tough problems, whether they're politically difficult problems to navigate, it's still our job to address the problems.  And the fact of the matter is this law, whether you like this law or don't like this law, has created problems that the states have to address.  And that's what I'm seeking to do and I'm seeking to do it in a way that works for us, not in a way that was dictated to us by Washington.

The ideas that I've proposed require a number of Federal waivers, and basically a waiver says, Washington wants us to do it this way, but we don't want to do it that way, so we will propose doing it another way and ask that you let us do it that way.  What I'm doing is providing that third way and saying, this is how we think that we can best take care of our own population and I'm hopeful that we can get the support for that, like we've seen, frankly, in other Republican states.

Indiana is a prime example.  You had Governor Mitch Daniels and now Governor Mike Pence, both extraordinarily conservative individuals, who are held up by the conservative wing of the Republican Party as people that we should look up to.  They have found that way for their state.  I'm simply trying to find that way for our state as well.

AARP : Do you think there is a pathway to get Medicaid Reform to a vote or for you to address this before the session ends?

Silvey: It's difficult to say.  We've kind of talked about it.  There are a number of Senators who are extraordinarily resistant to the idea and the question is whether – the question isn't whether this would pass. I have a firm belief that if I could get my plan to a vote on the Senate floor, the votes are there to pass it.  And furthermore, once it reaches the House, the votes are there to pass it as well.

The hurdle is not getting the votes to pass it - the hurdle is getting it to a vote, and right now, we have a small handful of senators that are indicating they would filibuster it.  If that's the case, and there are too many of them, there's no way that we can get it addressed this year.

However, next year, a couple of those senators will be gone, one of them is not running for re-election – in fact the one who's leading the charge against it is not running for re-election, so he'll be gone next year.  And then there's another Senator who's term-limited and a few others, so my hope is that, by starting conversations and discussions now, giving interviews and the time for people to review the actual plan, that by the time we return next session - if we are not able to get a vote this session - by the time we return next session, everyone will be comfortable enough with the concepts to move this policy forward next year.

AARP: Thank you so much for opportunity to come and talk with you for this special issue of our state newsletter State Line.

Silvey: Thank you for coming in. I always appreciate the opportunity to share ideas.