HHS Approves Waiver Allowing New Mexico To Expand Health Insurance Coverage to 40,000 Adults
HHS announced on Aug. 23 that it approved a waiver request by New Mexico to expand health insurance to an estimated 40,000 adults. New Mexico will increase health insurance options for childless adults ages 19 to 64 and parents of children enrolled in Medicaid or the state's CHIP program who have annual incomes up to 200% of the federal poverty level, or $17,720 for an individual and $36,200 for a family of four. In New Mexico, almost half of adults with incomes less than 200% of the federal poverty level are uninsured. "This approval means health coverage for tens of thousands of uninsured New Mexico residents -- including many uninsured parents whose children are already covered," HHS Secretary Tommy Thompson said. New Mexico will use unspent funds allocated for its CHIP program to expand health coverage by subsidizing private, employer-sponsored health coverage. The state will contract with managed care organizations to create a benefit package, which employers will offer to low-income, uninsured workers. Employers also will subsidize part of the cost of coverage, and employees will pay monthly premiums of $20 to $35, depending on income. People with incomes lower than 100% of the federal poverty level will not pay a monthly premium. Even though the waiver allows the state to use CHIP funds to insure adults, the state and the Bush administration re-emphasized "that covering children is the top priority of the CHIP program." CMS Administrator Tom Scully said that while "covering children must come first," the administration also wants states to "use the new waiver opportunity to expand health coverage to low-income adults who otherwise would not be eligible" (HHS release, 8/23). A recent report by the General Accounting Office examined waivers approved by HHS that allowed some states to use unspent CHIP funds to cover low-income adults who do not qualify for Medicaid. According to the GAO report, HHS' decision to approve the waivers "is not consistent" with the CHIP program's "statutory objective" to cover uninsured low-income children, and thus "is not authorized" (Kaiser Daily Health Policy Report, 8/15).
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