Business groups say the huge influx of federal money would be a financial windfall for the states. And health-care advocates point out that, in states that choose not to expand, the people left out will probably be fast-food employees, grocery store cashiers, construction workers and other very-low-wage earners — millions of people who were supposed to be some of the prime beneficiaries of reform.
Because of a quirk of the law, they would neither be eligible for Medicaid nor qualify for federal subsidies to buy private insurance.
“If we don’t expand, we will cement our position as last on every health indicator,” said Roy Mitchell, executive director of the Mississippi Health Advocacy Program. He said 300,000 low-income people in the state would get coverage under the proposal. “Mississippi may not see the vision of health-care reform realized.”
Democrats and Republicans in Mississippi are at a stalemate over the expansion, which Gov. Phil Bryant (R) opposes. Democrats tried to force their hand by blocking the reauthorization of Medicaid even at its current levels. The issue will have to be hammered out at a special session later this year to avoid affecting more than 600,000 current Medicaid recipients.
While some states that are leaning against expansion are holding special sessions to consider their options, others are looking at a compromise measure that would allow them to use the federal dollars to buy people private insurance, an idea pioneered by Arkansas.
The issue remains open virtually everywhere, partly because there is no firm deadline to opt in or out, but also because of the huge sums of money at stake. The Obama administration has devoted half a trillion dollars over 10 years to pay for the expansion, and many states have commissioned studies that show the money would be a boon to the local economy.
“This year I have been very cautious to say of any state, ‘This is off the table,’ ” said Nicole Kaeding, state policy manager for Americans for Prosperity, a conservative political advocacy group that has been lobbying states to reject expansion. “It’s always tempting to look at the promises of federal funding. These are some pretty big incentives.”
Medicaid is funded jointly by the federal government and the states. In most states, it is available only to children, pregnant women and extremely impoverished adults, but the law will allow states to include anyone making up to 138 percent of the poverty level, or $26,951 for a family of three in 2013 dollars.
Altogether, the states that have decided to expand Medicaid would add nearly 5 million people to the rolls, based on figures collected by the Urban Institute, though critics say the number could be much higher.
The Obama administration had intended for the expansion to be mandatory. But the Supreme Court ruled last year that states could opt out, leading many Republican governors to do so. The governors, including Texas’s Rick Perry and Louisiana’s Bobby Jindal, have opposed the expansion as an outgrowth of their objections to the law as a whole. They are against the idea of expanding a government entitlement program that they say is ineffective, encourages dependency and contributes to the national debt.
And many Republicans argue there is no guarantee the government will fulfill its promise to pay for most of the expansion. They say states could get stuck with the enormous bill — or face the politically fraught possibility of kicking people off the rolls.