Some states are looking for ways to offer more comprehensive or lower-cost health insurance on the individual market and to entice more of those currently uninsured to purchase coverage. One option currently getting the attention of states is Medicaid buy-in.
A Medicaid buy-in option is different from Medicaid expansion efforts under the Patient Protection and Affordable Care Act (ACA). A Medicaid buy-in approach can build on a state’s existing Medicaid program infrastructure and offer a Medicaid-like plan to specified residents.
Under a Medicaid buy-in proposal, the core target population would typically be those who are purchasing insurance using advanced premium tax credits (APTCs) or who are eligible for APTCs but uninsured. A Medicaid-buy in may allow individuals not eligible for commercial group coverage to purchase a Medicaid-like plan. This type of proposal may allow a state to replace or augment the current insurance marketplace and ACA premium assistance structure under federal waiver authorities.
States could use their own funds and/or leverage federal funding to develop a buy-in program authorized by a Section 1332 State Innovation Waiver. A state’s goals for a Medicaid buy-in through a 1332 Waiver could be further supported by a Section 1115 Demonstration Waiver or other Medicaid coverage changes.
In this paper, Milliman’s Paul Houchens, Christine Mytelka, and Susan Philip discuss buy-in proposals, exploring the opportunities at a high level and laying out key considerations for states as they weigh their options.