AUGUSTA, Maine — The Department of Health and Human Services is preparing to notify some Mainers who are expected to lose their health insurance coverage under Medicaid soon.

Come Oct. 1, thousands of Mainers are slated to lose benefits under MaineCare, the state’s Medicaid program, through controversial cuts aimed at balancing the budget that have fiercely divided lawmakers this year.

Democrats and Republicans agreed on one cut, however, that tightens income limits for about 12,000 parents who are on MaineCare. Lawmakers voted earlier this year to change the threshold at which residents qualify for MaineCare from 200 percent of the poverty level to 133 percent. For a family of four, that’s a change from a threshold of $46,100 in income a year to $30,657 a year.

“We will be shortly sending out a notice to consumers who are affected by the eligibility change from 200 percent to 133 percent for the parents,” DHHS Commissioner Mary Mayhew told members of the Legislature’s Appropriations Committee on Monday. “It is all subject to federal approval, so the notice will continue to reference that.”

Medicaid is run jointly by the state and federal governments.

Rep. John Martin, D-Eagle Lake, said he worried that recipients due to lose coverage will be confused unless the letter makes clear that the cut won’t take effect without a green light from the feds.

“We might as well get ready for the phone calls when they get the letters because people will not understand,” he said.

Mayhew said DHHS will carefully draft the letter to avoid confusion and make staff available to answer any questions.

“We are equally concerned about the sensitivity to how that letter is interpreted,” she said. “We are also concerned about not providing adequate notice.”

Sen. Richard Rosen, R-Bucksport, the committee’s co-chairman, pointed out that the panel unanimously approved the cut earlier this year.

Any changes the state makes to the MaineCare program must pass federal muster and comply with President Barack Obama’s federal health reform law.

Maine’s move to lower the qualifying income from 200 percent of the poverty level to 133 percent is allowed under the federal Patient Protection and Affordable Care Act. But a follow-up budget bill subsequently passed in the state Legislature by Republicans includes additional rollbacks that have caused a face-off between the LePage administration and the federal government over how much freedom the state has to balance its Medicaid budget in the wake of the U.S. Supreme Court’s ruling on the health reform law.

The court largely upheld the reform law, but ruled the federal government cannot penalize states that choose not to participate in the law’s call to expand the Medicaid program to millions of low-income Americans.

The state cuts at issue take the income restrictions a step further, lowering the qualifying income to 100 percent of the poverty level, or $23,050 a year for a family of four. While lawmakers passed the income restrictions in two stages, both are set to take effect at the same time, and both are subject to federal approval.

The budget bill also eliminates Medicaid coverage for 19- and 20-year-olds and makes cuts to a program that helps elderly and disabled people to afford insurance and prescription drugs.

The additional reductions would affect 23,000 people in Maine, Mayhew said.

DHHS won’t send notices to recipients about those cuts until the federal government weighs in on the department’s interpretation of the Supreme Court decision, Mayhew said.

Gov. Paul LePage’s administration, Maine Attorney General William Schneider and other Maine Republicans have said the ruling paves the way for the state to go ahead with the cuts by applying for a routine amendment to Maine’s Medicaid plan. Democrats, citing a July report and a letter from U.S. Health and Human Services Secretary Kathleen Sebelius, argue that the cuts require a special waiver from the feds because the reductions violate a provision of the law that bans states from cutting existing Medicaid services before 2014.

DHHS has requested an expedited ruling on the cuts from the federal Centers for Medicare and Medicaid Services.

In the meantime, the department is reviewing the cases of MaineCare recipients set to lose coverage to see what other benefits they might qualify for, Mayhew said.

I'm the health editor for the Bangor Daily News, a Bangor native, a UMaine grad, and a weekend crossword warrior. I never get sick of writing about Maine people, geeking out over health care data, and...