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HHS Delays Basic Health Plan Option Until 2015

The Obama administration has delayed by one year the rollout of a health program aimed at low to moderate-income people who won’t qualify for the expanded Medicaid program under the federal health law.

Under the so-called Basic Health Program, some states had planned to offer government insurance to people who don’t qualify for Medicaid, but who would be hard pressed — even with federal subsidies — to afford the premiums and cost-sharing of plans offered in the new insurance marketplaces. Those earning up to twice the federal poverty level, or about $47,000 for a family of four, would have been eligible.

The Department of Health and Human Services on Wednesday said it basically ran out of time to put out guidelines to get the program running by 2014.

“HHS expects to issue proposed rules regarding the Basic Health Program for comment in 2013 and final guidance in 2014, so that the program will be operational beginning in 2015 for states interested in pursuing this option.”

HHS said it will work with states to have the program available in 2015 and help states continue efforts to help people get coverage who don’t qualify for Medicaid.

Proponents of the Basic Health Program idea maintain that having such a plan would make coverage more affordable by offering lower cost-sharing.

Washington, Minnesota, Iowa and New York are scheduled to end their programs later this year because it was assumed beneficiaries would get coverage through the health law. Massachusetts’ program will expire in June.

Another advantage of the basic health program is that people won’t have to worry about paying the government back if their incomes increase during the year in which they are enrolled, while people getting subsidies could face that prospect.

“We see this as good news because we have a clear commitment that BHP funding will be available in 2015, as well as a commitment that the federal government will work with us to continue MinnesotaCare through 2014 until BHP funding becomes available,” said Jeremy Drucker, spokesman for Minnesota Department of Human Services. About 130,000 people are enrolled in MinnesotaCare, which is scheduled to end in December.