"It is the next step to provide increased access to health care for the uninsured," said Todd Shamash, Gov. Corbett's deputy chief of staff. "We said we were going to do it, and now we are delivering on it."
The news comes almost three months after Corbett, an opponent of the Affordable Care Act, announced his plan to make sweeping changes to the state's Medicaid program and ensure coverage for about 500,000 people.
His proposal, similar to the one submitted by Arkansas that received federal approval, would use federal funds to cover costs through the private insurance exchange system created under the Affordable Care Act, instead of expanding Medicaid rolls.
Corbett's "Healthy PA" plan has elements that could pose obstacles with the Obama administration: requirements that recipients pay a "modest" monthly premium and that working-age recipients be engaged in a job search in order to qualify.
Pennsylvania would be the first state to require able-bodied adults to participate in a job search or training program to receive Medicaid coverage.
The premium for new enrollees would be set up on a sliding scale based on income, and recipients could get reduced rates for meeting certain "health goals," such as a yearly physical, and for working, even part time.
For instance, for someone making up to 100 percent of the federal poverty rate ($11,600 a year for a single person), the rate would be $13 a month, but would be reduced to $6.50 if health goals are met. Those with the lowest incomes, along with pregnant women and the disabled, would be exempt from the premium fee.
All Medicaid recipients would be required to participate in a health-risk assessment when their annual eligibility review comes up.
"This is a comprehensive solution to improve health outcomes. These are changes we all want to see work," said Beverly Mackereth, secretary of the Department of Public Welfare.
Twenty-five states - including all of those surrounding Pennsylvania - plus the District of Columbia are moving forward with Medicaid expansion starting Jan. 1. The other states have said they will not expand their Medicaid program.
There is no deadline for states to opt in, but the clock starts ticking Jan. 1, when federal money begins flowing to the states.
Under the Affordable Care Act, the federal government covers the full cost of newly eligible Medicaid beneficiaries for the first three years and not less than 90 percent of the cost in the years thereafter.
It expands coverage to individuals and families earning up to 138 percent of the federal poverty level.
'Flexible as possible'
The Philadelphia hearing on the Corbett proposal is set for Jan. 3, from 10 a.m. to 1 p.m., at the Convention Center.
The waiver process can take up to 18 months for final approval. State officials said they will seek expedited approval but could not project when the Pennsylvania program might begin.
"We aim to be as flexible as possible with the state's approach, while ensuring Medicaid beneficiaries in Pennsylvania receive all of the protections afforded to them under the law," said Fabien Levy, a spokesman for the U.S. Department of Health and Human Services.
"We look forward to receiving the state's ideas and working with them on a compromise that allows the state to expand Medicaid through a solution unique to Pennsylvania."