Governors concerned about perils of phasing out Medicaid expansion funds
Published 5:55 pm Friday, February 24, 2017
- MorgueFile
WASHINGTON – Obamacare’s expansion of Medicaid health care for millions of low-income Americans has congressional Republicans who want to get rid of the costly provision in a quandary with the nation’s governors.
GOP House leaders report they’re working on ways to continue federal funding to the 31 Medicaid expansion states, but only until a replacement program could take effect that would likely shift a greater cost burden to the states.
Just how long the phase in period would last and the specifics of the substitute remained uncertain as the governors gathered in Washington for their annual conference that starts Sunday.
Politico reported Friday that a draft of a replacement bill would stretch the transition to the year 2020. House Speaker Paul Ryan’s replacement legislation last year proposed a two-year phase in.
The governors will meet privately with new Health and Human Services Secretary Tom Price, then with President Trump and House members on Monday. They have a lot at stake as Medicaid is one of the largest sources of federal funds for states.
Some 14 million adults across the country within 138 percent of the poverty line – or at the most $16,400 for a single person – have qualified for health insurance under Obamacare’s Medicaid expansion.
A Kaiser Family Foundation survey Friday said 87 percent of residents in the 16 expansion states with Republican governors want to keep federal funding for the program.
Even governors from those states that decided not to participate in Medicaid expansion are anxious about replacement legislation and how it might impact traditional Medicaid services.
More than 70 million low-income children and parents, pregnant women, the disabled and the elderly rely on traditional Medicaid or the related Children’s Health Insurance Program (CHIP). Government budget figures show the cost is more than $500 billion, with the federal government paying 63 percent and the states 37 percent.
A summary of the several bills Republican House leaders are considering for changes to the Medicaid expansion envisioned “a period of stability to ensure we are not pulling the rug from underneath states or patients.”
But, it also said: “Obamacare’s Medicaid expansion for able-bodied adult enrollees would be repealed in its current form.”
The GOP summary indicated federal funds would continue to temporarily fund 95 percent of the money states like Massachusetts, Pennsylvania, Kentucky, Indiana and West Virginia spend on Medicaid expansion recipients. It also said states would be given more flexibility in rolling back Medicaid and administering the program.
At the end of the transition to a replacement program, however, they would receive the smaller portion that they get from traditional Medicaid, the summary said.
“It’s a huge difference,” said Jesse Cross-Call, senior health policy analyst at the progressive Center for Budget and Policy Priorities.
The Republican summary said those Americans losing Medicaid coverage would be eligible for a monthly tax exemption to help lower the cost of health insurance. It added that could also help those who make too much for expanded Medicaid and too little for insurance subsidies under the Affordable Care Act.
Rep. Todd Rokita, R-Ind., argued Medicaid spending is out of control. The expansion provision “has to be walked back,” he said in an interview.
Medicaid expansion was intended to help the very poor, said Rokita. But its expansion has allowed able-bodied people to also gain coverage, greatly impacting state as well as federal budgets, he added.
Kentucky Gov. Matt Bevin, in a letter to House Majority Leader Kevin McCarthy, R-Calif., last month estimated the state’s portion of Medicaid expansion will amount to $1.2 billion over the next five years. He urged McCarthy to gradually reduce aid to people over the poverty line.
The Republican leaders’ memo didn’t mention this matter specifically but it said: “Governors and state legislators … know better than Washington bureaucrats where there are unmet needs and opportunities to cut down on waste, fraud, and abuse.”
Some states like Kentucky have sought federal permission to impose conditions like work requirements and cost-sharing on Medicaid recipients covered by the expansion program.
Massachusetts Republican Gov. Charlie Baker in a letter to GOP leaders said 300,000 people in his state are insured under Medicaid expansion. He urged Congress not to shift costs to the state.
Rep. Kevin Brady, R-Tex., chairman of the House Ways and Means Committee, said whatever Republicans come up with as a replacement for Obamacare and its Medicaid provision, it will allow “Americans to buy a health care plan that’s right for them, not what’s right for Washington.”
Kery Murakami is the Washington reporter for CNHI. Contact him at kmurakami@cnhi.com.