More states consider Medicaid expansion — is the tide beginning to turn? | Arkansas Blog

Monday, March 24, 2014

More states consider Medicaid expansion — is the tide beginning to turn?

Posted By on Mon, Mar 24, 2014 at 2:41 PM

click to enlarge db_medicaid_map_lg_1_.jpg

With New Hampshire likely to pass its own version of the "private option" for Medicaid expansion this week, National Journal predicts that the dam is beginning to break and we may see a wave of holdout states finally accepting the federal money, available via the Affordable Care Act, to expand Medicaid.

With 25 states and the District of Columbia opting in to Medicaid under the Affordable Care Act and another six in limbo, the tumult in a handful of holdout states is increasing. The White House hopes unrest in states like Florida, New Hampshire, Nebraska, and Maine will help turn the fight decidedly in their favor. And there's good reason to think that's happening.

The article's headline is "States Holding Out on Medicaid Expansion Are Beginning to Crack." Maybe so, though I think there's at least a little bit of wishcasting going on here; resistance in many hardcore anti-Obamacare states will continue to be fierce and well-organized. Still, if not inevitable, the slow march of Medicaid expansion is looking more and more like it has the wind at its back. Expansion is both a good fiscal deal for states and a means to offer health insurance to low-income uninsured folks who desperately need it (and who fall into a tragic coverage gap in states that decline expansion). Many state lawmakers, including opponents of Obamacare, are coming to grips with the real costs of turning down billions in federal money.

Fortunately for Arkansas, state lawmakers found a way to say yes to expansion (via the private option) sooner than later. That's good news not just for low-income Arkansans but the state budget. States that drag their feet but say yes down the road leave money on the table — the costs of expansion are fully federally funded from 2014-2016, and states have to start chipping in thereafter (the state contribution is 3 percent in 2017 and then incrementally rises to 10 percent in 2020 and beyond). The best deal for states is to take advantage of those initial 100-percent-match years. If National Journal is right, and states start moving toward expansion in years to come, they'll be accepting the deal while missing out on the most generous part. Talk about cutting off your nose to spite Obama's face. 

Still pretty incredible to see Arkansas on the map above, green amid a sea of gray in Dixie. Of course, the private option was in jeopardy in the fiscal session this year, and the national media watched closely to see if Arkansas might be the first state to go in the other direction and turn back on expansion after initially going forward. That would have meant kicking around 150,000 Arkansans off of coverage they'd just gained, which always seemed like a heavy lift politically. Still, it took five tries to get the private option re-authorized in the House, and many predict another drag-out fight in 2015. That will no doubt lead to lots of stories about Arkansas as a potential harbinger in the great Medicaid expansion debate. But the truth is, it's not just the private option policy that make the state unique. In fact, Arkansas might be the most likely state in the country to put a stop to an expansion that it started, for reasons that have no predictive power anywhere else in the country. That's because of the state's 75-percent threshold on certain appropriations that makes for an incredibly high bar to pass the private option every year. Here's what Gov. Mike Beebe had to say in the middle of the re-appropriation fight in during the fiscal session:

This is a point I tried to make in D.C. with all the various media, particularly the national media that don't understand Arkansas...that the issue — they'll always ask why so much opposition? I try to explain to them, there's not much opposition. That's the wrong question. You're hitting on the wrong issue. The issue is 75 percent. If the issue was 51 percent, we wouldn't be talking. If the issue was even 60 percent or two-thirds, we wouldn't be talking. The issue is Arkansas's constitutional 75-percent requirement on appropriations so that a small, small minority can block stuff. 

The private option was supported, and supported again, by an overwhelming majority of the legislature. That's what made it so silly when Rep. Bruce Westerman suggested to the Virginia legislature that the policy's rocky path to re-authorization somehow represented buyer's remorse. And it's what makes Arkansas something of a misleading test case for the theory that once a state expands, a legislature won't turn around and kick everyone off. Because of the 75-percent threshold, that could well happen next year in Arkansas. But every other state in the country? If they can build the big bipartisan legislative majorities we've seen in Arkansas, the future of expansion will be looking very good indeed. 

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