While Connecticut businesses are closely monitoring legislation raising the minimum wage, proponents of the measure may not have anticipated its potential policy ramifications.

For example, some residents could lose their Medicaid eligibility if the state raises the minimum wage to $15 an hour.

As a result, there have been discussions within the Lamont administration about proposing a Medicaid buy-in public option for businesses and individuals that will allow those otherwise ineligible to enroll in Medicaid and access benefits at full cost.

A minimum wage increase may impact the state's healthcare exchange, Access Health CT, by forcing some individuals off Medicaid and onto the exchange, where they will be required to pay a premium.

Even if these individuals receive a federal subsidy to purchase insurance from the exchange, the cost of insurance will likely exceed their wage increase.

A buy-in public option will further strain the state's Medicaid program, with potential to affect the exchange and private insurance pools.
The success of any Medicaid buy-in program should be contingent on participation by businesses and individuals that will pay the full premium amount in order to offset costs.

Absent high participation, a Medicaid buy-in program will become an expensive health insurance alternative for businesses.

Despite Connecticut being an innovative leader in Medicaid, the program's sustainability has been a constant concern.

A buy-in public option will further strain the state's Medicaid program, with potential to affect the exchange and private insurance pools.

CBIA will continue to monitor this issue, and other implications of raising the minimum wage, in the coming weeks.


For more information, contact CBIA's Michelle Rakebrand (860.244.1921) | @MRakebrand