Michigan Medicaid History and Facts

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Initial Medicaid Implementation: Michigan was crucial to the initial passage of the Medicaid and Medicare law. It was at University of Michigan where President Johnson gave his Great Society speech in 1964 and Michigan Senator McNamara was in opposition of early Medicare and Medicaid legislation because he opposed to cost sharing or any income test in Medicare. Michigan began their Medicaid program in October of 1966. When the program began it was estimated that 4 percent of the states residents enrolled in Medicaid coverage. By 1967 Michigan’s Medicaid program was already running fiscal deficits and substantial payments were being made to non-welfare cases because the eligibility levels were well above welfare eligibility levels. Michigan began to be concerned with fraud and high payment rates of physicians finding that one physician was paid as much as $169,000 from the Medicaid program.

Key Medicaid Political Issues: Michigan has delivered services through HMOs since the early 1970’s. In 1997 the state fully privatized the system, including the disabled population. The state was an early adopter in providing services through a HMO to disabled individuals. Through the late 2000’s and early 2010’s the state continued to make MCO enrollment mandatory for special eligibility groups including dual eligible through the CMMI demonstrations.

Medicaid Expansion Implementation: Michigan expanded their Medicaid program in 2013 with benefits beginning on April 1, 2014. The Centers for Medicare and Medicaid Services (CMS) approved a waiver for Michigan’s Medicaid expansion alternative plan on December 30, 2013. This plan, known as the Healthy Michigan plan used the premium assistance program similar to Arkansas and Iowa’s waiver applications, premiums and additional cost sharing, and certain wellness program benefits that can reduce medical expenditures for the beneficiary if the person participates in a wellness program. In 2017 the state legislature voted to approve a plan that would add work requirements to the Medicaid expansion program. The plan was widely critiqued for exempting certain predominately white counties while subjecting urban predominately African American counties to the requirement. The legislature decided not to include this policy in the final bill that was approved by the legislature. The work requirement waiver is currently under review with CMS. Aside from the addition of work requirements, the state’s 1115 waiver ends the premium assistance program

General facts about Michigan Medicaid:

Medicaid program name: Medicaid

CHIP Program name: MICHIP

Separate or combined CHIP: Combination

Medicaid Enrollment: 2.3 million (2018 estimate)

Total Medicaid Spending: $16.8 billion (FY 2017 estimate)

Share of total population covered by Medicaid: 22%

Share of Children covered by Medicaid: 40% (estimate)

Share of Medicaid that is Children and Adults: 78%

Share of Spending on Elderly and people with disabilities: 62%

Share of Nursing Facility Residents covered by Medicaid: 60% (estimate)

FMAP: 64.45%

Expansion state: Yes

Number of people in expansion: 637,000 (2017 estimate)

Work Requirement: No* under consideration by CMS


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