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story.lead_photo.caption Campaign workers David Woodruff, left, and Jason White, right, deliver boxes of initiative petitions signatures to the Missouri secretary of state's office in Jefferson City, Mo., on Friday, May 1, 2020. The Healthcare for Missouri campaign said it gathered nearly 350,000 signatures for a proposed constitutional amendment expanding Medicaid coverage to thousands of low-income adults. If enough valid signatures are verified, the measure would appear on the November 2020 ballot. (AP Photo/David A. Lieb)

Tuesday's passage of Amendment 2, which expanded Medicaid coverage in Missouri to adults making up to 138 percent of the poverty level, set wheels in motion.

The amendment requires the Missouri Department of Social Services and its MO HealthNet Division to submit a Medicaid plan to the Centers for Medicare & Medicaid Services by March 1.

The state agencies must provide expansion no later than July 2021, according to the Missouri Hospital Association.

The division will in the coming weeks begin engaging with state departments responsible for Medicaid and with legislative budget leaders to review implementation options, according to Rebecca Woelfel, communications director for the Missouri Department of Social Services.

"Missourians must be aware, based on the language of Amendment 2, that until July 1 of next year, Missouri Medicaid eligibility requirements remain unchanged," she said. "The proposal will have a substantial impact on next year's budget."

About 53.25 percent of voters approved expansion, with 46.75 percent opposed, making Missouri the 38th state to do so. The District of Columbia has also expanded.

MHA, which advocates for policies that improve health care and provides data and resources to help hospitals, has already reached out to stakeholders it will work with — including Gov. Mike Parson's office, members of the General Assembly and others — to smooth implementation of expansion, according to Dave Dillon, MHA vice president of public and media relations.

Funding for the expanded program will have to be budgeted, Dillon said. Lawmakers will have to pass legislation. In essence, he said, there are bureaucratic components that need to be taken care of to make it happen.

It is estimated that expansion of MO HealthNet, the state's Medicaid program, would add about 230,000 people to its rolls. MO HealthNet already serves about 900,000 people.

A fiscal note received by the state House Budget Committee this summer said there is a possible range in cost to expand from an annual expenditure of $200 million to a savings of $1 billion.

A successful initiative petition this spring got the issue placed on the November ballot. Parson, a Republican, scheduled the vote for the August primary election.

"The fact that this was on the August ballot instead of the November ballot is advantageous," Dillon said. "It gives us more time to sort through what policy decisions can be made."

The MHA hired a national research and consulting firm, Health Management Associates, to conduct a study of states that have expanded their Medicaid programs. That study looked at Arkansas, Indiana and Ohio.

Each of those states customized their programs to keep costs under control and capture dollars available for them to help fund expansion.

Expansion is part of the Affordable Care Act, also known as Obamacare. As an incentive for participation, the federal government pays 90 percent of the cost for people who qualify under expansion. The federal government pays 100 percent of the cost for enrollees who qualify under expansion for Medicaid coverage to states that expanded within the first couple of years it was offered.

States saw Medicaid cost savings after expansion, the report found.

"The full cost of a well-designed and well-synchronized program in Missouri can be covered by the offsets from replacing state-only funding with a 90-percent federal match, current Medicaid programs that would be matched at higher rates and other policy and operational adjustments," according to the report. "Synchronizing an expansion with the appropriate policy and operational adjustments is imperative to designing a cost-effective program."

Some states adopted Medicaid expansion as it was envisioned in the Affordable Care Act, Dillon said. The MHA and other stakeholders are trying to optimize expansion for Missouri.

"One of the things we focused on was what we could do as a state to create a model for implementation that would reduce the influence on the state budget while at the same time produce the benefit," he said. "We've seen what states did that did not (expand early) and did not start with 100 percent (federal funding). They have indicated it can be done."

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