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How Many States Are Really Opting In?

Same story, different week: A governor who opposed the Affordable Care Act changes course and announces plans to opt into the Medicaid expansion.

Supporters of the ACA rejoice, conservatives grumble, and a new number gets tacked on the board — 24 states opting in, at last count.

Yet there’s more to the story than governors’ speeches. In at least eight of those states, lawmakers are warning that they may not go along with expansion plans.

Those legislative logjams — and what governors need to do to circumvent them — vary state by state , but the fights are falling out along party lines.

In Missouri, two GOP-led House committees this week voted down Medicaid expansion plans, despite Democrat Gov. Jay Nixon’s pledge to opt into the measure last year. Republican lawmakers in Arkansas, Montana and Washington have similarly been skeptical of their Democratic governors’ expansion positions. Meanwhile, four GOP governors who have backed the expansion are having difficulty corralling members of their own party.

“All the states are different,” Matt Salo, executive director of the National Association of Medicaid Directors, told me. “But for all intents and purposes, you need the executive and legislative branches to agree.”

GOP Legislatures Balk Over Cost, Risk

That basic civics lesson has been largely ignored as one governor after another announced plans to participate in the law’s Medicaid expansion.

Proponents of the ACA have been particularly gleeful as several leading Republican governors — Arizona’s Jan Brewer, Ohio’s John Kasich, Michigan’s Rick Snyder and Florida’s Rick Scott — have come out in favor of the expansion across the past six weeks.

“The fact that [those Republican] governors have opted into the Medicaid expansion are game-changers,” Ron Pollack of Families USA told me last week, after Scott’s announcement.

“I think the dominoes are going to fall into place fairly soon.”

Where the States Stand

Via: The Advisory Board Company

Pollack’s probably right. Scott’s decision was especially significant, both for its practical — Florida stands to insure one million more residents through the expansion — and symbolic implications, given his status as a leading critic of Obamacare. And last week’s announcement may well have given New Jersey’s Chris Christie more cover on Tuesday to announce his own support for the Medicaid expansion.

But even if the game’s changed for Republican governors, many GOP legislators within their own states continue to fight the Medicaid expansion using a well-worn playbook to criticize the law’s costs and possible risks.

Arizona’s House speaker: “We have no faith in the federal government” to fulfill its Medicaid obligations.

Florida’s House speaker: “I am personally skeptical that this inflexible law will improve the quality of health care in our state and ensure our long-term financial stability.”

Michigan’s House speaker’s spokesperson: “The federal government has a history of working with states to start long-term programs while providing short-term funding, and then sticking state taxpayers with the future financial liability.”

Ohio’s House speaker: “Our problem … [is] if the federal government continues to operate the way it has the last several years, they may or may not have the money to live up to their obligations.”

What Comes Next if There’s a Split

Some state lawmakers appear unclear on what happens if the Legislature and governor differ on the Medicaid expansion.

“It would be a very legally interesting situation,” Brian Kane, Idaho’s deputy attorney general, testified at a committee hearing last summer. “That’s a very involved powers-of-government question, from my perspective.”

But what it boils down to: The governors who favor the Medicaid expansion really can’t move forward without their legislatures, which need to authorize and appropriate the necessary funds.

(Governors who want to expand Medicaid can make provisional arrangements to avoid last-minute scrambling, according to Salo. For example, they can work with vendors to have systems that are ready to operate under the expansion’s expanded eligibility requirements if necessary, should the state move to opt in after all.)

Under the Supreme Court’s ruling on the ACA, legislators can wait months or years to hammer out an agreement, if they want to opt in at all. But there’s a significant financial incentive to reach a decision before the year’s done.

The federal government’s 100% matching funds are only available from Jan. 1, 2014 through Dec. 31, 2016, Salo noted. “And every month that you’re not [part of the expansion] is a month that you’re not getting that Medicaid match.”

Legislatures May Be Playing Role of Token Resistance

That financial hook, which has swayed staunch conservatives like Scott and Christie, may ultimately end up winning over legislatures too.

(And if it seems like we’ve been here before — well, we have. After considerable hue and cry, every state governor ended up accepting stimulus funds because the package was seen as just too good.)

The government also continues to sweeten the pot for holdouts; Arkansas Gov. Mike Beebe on Tuesday announced that HHS had approved an unusual waiver to allow the state to use federal funds to help residents buy private insurance.

Meanwhile, it’s possible that the most critical legislatures may simply be going through the motions of offering token, partisan¬†resistance. Earlier this week, the GOP chair of North Dakota’s House health committee warned the Associated Press that “the caucus [was] divided” on its upcoming vote over Medicaid expansion.

A day later, that divided caucus voted 12-1 to opt into the expansion.

Dan Diamond (@ddiamond) is Managing Editor of the Daily Briefing, a CaliforniaHealthline columnist, and a Forbes contributor. This post originally appeared at CaliforniaHealthline.org.

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8 replies »

  1. Federal funding is never certain and never has been. Congress can change the law and end programs whenever they choose. It’s obviously not easy to do – there’s a reason for the saying “It will take an act of Congress.”

    Here in Kansas we have legislators who, in the same breath, will say that once Congress establishes a program it’s impossible to get rid of and then state that they don’t trust the feds to keep their funding obligations. That seems like having it both ways.

    States accept obligations from the federal government that require state investment every day. One example: Kansas officials are working to move the National Bio-Ag Defense lab to Manhattan, KS from Plum Island, NY. Securing this multi-hundred million dollar project has been a top priority of the Kansas congressional delegation and the governor for years. I’ve never heard a single one of these officials express even a shred of concern that the feds will not have the money to continue funding the lab in the future. No, this is federal dollars creating economic development and jobs. Well, guess what? So is Medicaid expansion.

    So, I understand state lawmakers who are wary of accepting additional obligations. What I object to is the view that federal money for some projects is a public good, while federal money for other projects is immoral (which is one way Medicaid expansion has been described). For many, nothing from the ACA will ever be acceptable, regardless of the potential benefits to the state or its citizens. We cannot even have a rational discussion about this in the Kansas legislature; it’s part of Obamacare, so it doesn’t get a fair hearing.

    So, that’s a long winded way of saying what I said in my original post – from where I sit, this doesn’t appear to be about money and budgets. It appears to be about politics.

  2. Out of curiosity, SW, how would you respond to state lawmakers like Arizona’s Andy Tobin, who says that changes to federal funding for TANF and unresolved budget fights in DC make him nervous about accepting additional obligations?

  3. As one source told me, it’s interesting to ponder the motives of why — or why not — lawmakers would opt into the expansion.

    A governor bidding for reelection might be more inclined to accept the expansion, and get credit for expanding health coverage within the state. But a conservative governor with aspirations of holding national office might be less inclined to take the expansion, at least immediately, out of fears over how it would play with the conservative base.

    So what’s the calculus for state legislators?

  4. When governors and state legislatures start turning down other federal expenditures and contracts because they’re worried about long-term financial liabilities then I’ll take them seriously. Denying Medicaid expansion is not about state costs or concerns that the feds won’t meet their statutory obligations. It’s about resistance to Obama and the ACA, plain and simple.

  5. Roy, that’s not true. There are good reasons to be nervous about the long-term financial liabilities. States spend so much on Medicaid as it is.

  6. Medicaid expansion under the Health Care Affordability Act is a “no brainer”. Those states that do not buy in are exposing their cranial voids.

  7. Strong governors will be able to bulldoze their legislatures into going along, or not going along as the case may be.

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