Lawmakers Could be Moving Closer to Compromise on Medicaid Expansion

Written by Bob Bernick on . Posted in Today At Utah Policy

While no final decision has been made – or at least, not announced – on Medicaid expansion by the State of Utah, there could be a compromise in the works.

 

In a talk before the Utah Taxpayers Association on Monday, House Speaker Becky Lockhart said that if a deal on the expansion is approved this coming Legislature – “and that is a big IF,” she said – then at the very least she wants to make sure that some money is put away in the coming budget for the estimated $70 million it will cost Utah soon after the three-year federal pick-up of all of the expansion costs runs out in 2017.

GOP Gov. Gary Herbert says it is his decision, and his alone, whether Utah opts into the federal Medicaid expansion that comes as part of Obamacare.

The federal government promises to pay 100 percent of the expanded cost for the next three years, and then through a phase in will pick up 90 percent of the cost thereafter.

Some conservative governors in other states have, in agreement with their conservative legislatures, refused the Medicaid expansion – thus turning their backs on hundreds of millions of dollars in federal aid.

But there has been considerable pushback from various groups locally – including many religious leaders in Utah sans the LDS Church – against such a rejection here.

Herbert recently said that he and GOP legislative leaders would announce a Medicaid compromise before the 45-day general session starts Jan. 27, now just two weeks away.

And while it may be Herbert’s call – legally – about Utah’s Medicaid future, the political reality is he’s not going to stick his neck out on this one without at least GOP legislative leaders’ agreement.

Several lawmakers, including Lockhart, may be looking at the 2016 gubernatorial election – and a challenge to Herbert within GOP ranks.

Rep. Jim Dunnigan, R-Taylorsville, is the House’s GOP front man on Medicaid expansion.

It’s a complicated issue. Dunnigan told the taxpayers meeting that he spent over an hour on the subject in a December House GOP caucus (closed to the public) and few representatives could keep their eyes open toward the end.

Still, Dunnigan passed out a summary Monday that shows the few options that Obamacare offers the states, and the consequences for Utah if they join up.

Dunnigan Medicaid Sheet

Despite a U.S. Supreme Court ruling that declared Obamacare constitutional – but said its up to the states themselves whether they participate in the Medicaid expansion part of the massive new health care law – Dunnigan said there is still a mandatory part to the Medicaid expansion eligibility.

Basically, the state must pick up the costs of poor people who now are eligible under the expanded program.

That, today, is estimated at around 51,000 adults and children, at a cost of $25.7 million.

Beyond that there are options for the state, including not taking the federal money at all and trying to find other ways of providing health care to the new folks coming on to the Medicaid rolls.

(There are various estimates on how many that will be, said Dunnigan.)

But there will be people who were – and are – eligible for Medicaid before Obamacare and will come on now because of all the publicity about the new program -- which, for them, “free” health care.

They also want to sign up to avoid penalties if they don’t have some kind of health care insurance.

One option for folks that are 0 percent to 100 percent of poverty level would cost $18.7 million and provide premium assistance, said Dunnigan.

For those 101 percent to 138 percent of poverty level, they would get federal subsidies through an exchange.

A second option deals with those 0 percent all the way to 138 percent poverty level – they get the same premium assistance. That would cost $40.8 million.

Option one and two both cover an estimated 111,000 Utahns.

And both Options one and two are over and above the mandatory expansion, $25.7 million, that covers around 51,000 low-income Utahns.

If Utah goes with Medicaid expansion in some form, said Lockhart, R-Provo, “We need to start putting money aside now, so we have the money in the third year” when the federal subsidy goes from 100 percent to 90 percent.

Dunnigan said he understands those who are worried that the federal government – facing $17 trillion in debt – won’t come through with the 90 percent in the third year and beyond.

That would put the states in the back position of taking away poor people’s health care benefits and/or picking up hundreds of millions of dollars in new costs.

“There is no hard deadline to expand (Medicaid),” said Dunnigan. And many folks, including some legislators, don’t understand that.

While the Obamacare deadline was Jan. 1 – all Americans are supposed to sign up for some kind of health care insurance by mid-March – Utah can actually join the Medicaid expansion anytime over the next three years.

“We could even sign up quarterly,” he said.

But if Herbert and legislators wait until, say, 2016, then Utah would only get one year of the 100 percent federal funding, 90 percent after that.

The idea, said Dunnigan, is that poor Americans who today either use “free” emergency room care or go without would be covered under some kind of health insurance.

And the cost and use of emergency rooms would go down.

But early indications are that may not be the case.

“Poor” people who had no health care coverage, once they get an insurance card in their pockets, will start using health care more often, said Dunnigan.

“I believe (Obamacare) is driving up the cost of health care, not reducing it,” he added.



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