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Corbett eyes new use for Medicaid dollars

| Wednesday, April 3, 2013, 9:42 p.m.

HARRISBURG — Gov. Tom Corbett said Wednesday that he is interested in a concept that would give health care to hundreds of thousands of Pennsylvanians by using federal Medicaid dollars to buy private insurance.

Corbett revealed that he is seeking information about the idea a day after meeting with U.S. Health and Human Services Secretary Kathleen Sebelius about an expansion of Medicaid that's called for under the 2010 federal health care overhaul. Some governors have resisted the expansion, citing fears that states will be stuck with more of the bill than forecast.

The idea of buying private insurance with Medicaid money was first broached by Arkansas' Democratic Gov. Mike Beebe as a way to get his Republican-controlled Legislature on board with the expansion. Other governors who also support a Medicaid expansion but face skeptical lawmakers are looking into it as well, including Democratic Gov. Jay Nixon of Missouri and Republican Gov. John Kasich of Ohio.

Under a proposal in the Arkansas Legislature, people who earn up to 138 percent of the poverty line, which amounts to $15,415 per year, would receive private insurance purchased using federal Medicaid dollars. The plans would be bought through the insurance marketplaces being created under the federal health care law.

However, a report from the nonpartisan Congressional Budget Office last summer said plans on the private insurance market are more expensive for taxpayers than traditional Medicaid coverage.

The report estimated that purchasing a private plan through the insurance marketplaces would cost $9,000, while traditional Medicaid coverage would cost $6,000.

Arkansas and Ohio are in talks with Health and Human Services over the details, said Matt Salo, the executive director of the National Association of Medicaid Directors, a Washington-based group that represents state officials.

“There are active discussions between Arkansas and the administration, and Ohio and the administration,” Salo said. “... This could be a game changer, and it could have a potential domino effect.”

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