State lawmakers gird for battle over Medicaid expansion

As state legislatures prepare to meet in January, lawmakers across the country are girding for a battle over whether to sign on to the health-care law’s expansion of Medicaid.

“This is the number one issue,” said state Sen. Michael Lamoureux (R), incoming president of the Arkansas Senate. “And in 10 years this is by far the most difficult one we’ve ever dealt with.”

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The national implications loom just as large. No provision is more central to achieving the health-care law’s aim of extending coverage to the uninsured than its expansion of Medicaid. Under the new rules, beginning in 2014 eligibility for the program would be opened to people with incomes up to 133 percent of the federal poverty level, or about $30,657 for a family of four.

The law calls for the federal government to foot the the entire bill for covering the newly eligible for the first three years. After that the federal match phases down slightly, reaching 90 percent by 2020.

Arkansas state Sen. Cecile Bledsoe (R) questions whether the federal government can be counted on to maintain such a high match rate in perpetuity. With all the budget pressures facing Congress members, said Bledsoe, how can she be sure they won’t shift more of the burden to states down the road?

Last August Obama officials sought to allay such concerns by clarifying that states are free to drop out of the Medicaid expansion at any time. But Bledsoe, a key leader in the Arkansas Senate on health issues, said that’s not a realistic option.

“We’re not going to put more than 250,000 people on our Medicaid rolls, then pull them off,” she said.

Bledsoe said she will not feel confident about the federal commitment at least until after Obama concludes negotiations with congressional Republicans over avoiding the “fiscal cliff.”

“At this point I don’t see anyone willing to take a chance on what the federal government might or might not do,” she said.

With barely a year before the expansion is scheduled to begin, only 14 states seem certain to join in. About 13 states seem likely to opt out because the GOP has a lock on both the governors’s office and the legislature and many of these Republicans are dubious of expansion. But even here the outcome is often in doubt. For instance, Florida’s Gov. Rick Scott (R) has been one of the most scathing critics of expanding Medicaid. But in an interview shortly after the election, Scott suggested he was open to trying to “get to yes” on the issue.

Meanwhile, in more than a third of states, governors and state lawmakers have been so vague about their intentions, or so at odds, that it is impossible to predict how the debate will play out.

In Colorado, where Democrats hold both the legislature and the governor’s mansion, the challenge is less ideological than practical. State revenue is not expected to rise fast enough to cover the extra cost of enlarging Medicaid in coming years. And the state constitution prohibits lawmakers from raising taxes without a voter referendum.

They could find that the only way to make up the difference is through unpopular cuts to spending on education — one reason Gov. John Hickenlooper (D) has so far been noncommittal.