Monday, November 28, 2016

Medicaid expansion could be on chopping block, but some red-state governors want to keep it

Posted By on Mon, Nov 28, 2016 at 8:25 AM

HUTCHINSON: His Medicaid expansion program, Arkansas Works, could be on the chopping block if Paul Ryan gets his way.
  • HUTCHINSON: His Medicaid expansion program, Arkansas Works, could be on the chopping block if Paul Ryan gets his way.

Good roundup in the AP
on the GOP-led states that have expanded Medicaid with funding that is potentially on the chopping block with the election of Donald Trump. That includes Arkansas, where more than 300,000 Arkansans have coverage through the private option, the state's unique version of Medicaid expansion.

Gov. Asa Hutchinson and other red-state governors in states that expanded Medicaid say they would like to see more flexibility from the federal government for stuff like work requirements or making poor people pay premiums or other out-of-pocket costs for coverage. But this wish list presupposes that the Medicaid expansion itself continues. The governors in states that have expanded Medicaid may want to tinker, but they want the coverage expansion to stay in place. Which means, although they sometimes dance around this point, that they do not want to see the federal funding for Medicaid expansion repealed. (Hutchinson himself said earlier this year on the record that he would like to see the coverage expansion continue under an Obamacare "replace" plan).

The problem is that Trump has promised to repeal Obamacare, which would mean ending the funding for Medicaid expansion. It's true that Congress could replace the law and replace it with something else that funded continuing the coverage expansion. But, and I'm going to be a broken record on this point, it's worth remembering who actually passes the laws. Congress has the outline of a plan, House Speaker Paul Ryan's "Better Way," and it entirely repeals the Medicaid expansion funding in 2019. Hutchinson often talks longingly of the potential for block-grant-style funding for Medicaid, which Ryan's plan does (technically via a per-person cap).

But that block-grant funding is, in practice, for the old Medicaid program that existed before the Affordable Care Act. Ryan does not "replace" the funding that Obamacare enacted to expand coverage to low-income adults. Under Ryan's plan, the private option (or Arkansas Works, or whatever you want to call it) would die and hundreds of thousands would lose their health insurance.

No one knows precisely how all of this will play out, but keep in mind that (with the exception of some state lawmakers in places like Arkansas), Republicans have been railing against the evils of the Medicaid expansion since Obamacare was passed. Republicans now control every lever of federal power. The most likely scenario is that they will try to enact a law that repeals the Medicaid expansion, ending the flow of billions of federal dollars to states like Arkansas, and phasing out coverage for millions of low-income Americans. If Ryan has his way, they will also block grant what remains of the Medicaid program, which will be massive a de facto funding cut that will likely lead to benefit or eligibility cuts to the program's neediest beneficiaries.

The wild card here, in addition to Trump himself, is the politics. It's easy to make speeches against Obamacare; it's hard to snatch insurance away from millions of people. See, for example, Kentucky, where Gov. Matt Bevin campaigned on doing away with the Medicaid expansion, only to do an about-face when he got to office (like Hutchinson, he seeks conservative bells and whistles, but wants the Obamacare-funded expansion to continue). One potential pressure point is red-state governors like Hutchinson, who would like to see the federally funded coverage expansion continue (albeit with right-wing alterations likely to make the program much worse for beneficiaries).

State lawmakers like Hutchinson often had to dance around Obamacare questions over the last several years. On the one hand, he wanted to see root-and-branch repeal; on the other hand, he enacted a policy dependent on Obamacare funding. Republicans on the state level could plausibly say that they were making the best situation they could out out of the law as it was. Where things got sticky was the hypothetical: the promise from Republicans in Congress to eliminate the Medicaid expansion altogether. Does Hutchinson support that? It's not hypothetical anymore.

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