State must ponder Medicaid expansion

By Bobby Harrison/NEMS Daily Journal

JACKSON – Mississippi’s political leaders, who for the most part denounced Thursday’s U.S. Supreme Court ruling upholding President Barack Obama’s Affordable Care Act, must now decide whether to proceed with a portion of the law that expands health care coverage through the Medicaid program.
The Supreme Court upheld the law that mandates people who can afford health insurance purchase it and expands coverage to an estimated 30 million Americans.
One of the methods is through Medicaid, a state-federal program. In Mississippi, Medicaid provides health insurance for poor pregnant women and poor children, the disabled and certain segments of the elderly population.
Under the health care act, starting in 2014, adults earning less than 133 percent of the federal poverty level or less than $14,400 annually, can receive health coverage through Medicaid.
The 26 states, and others who challenged the law in court, not only attacked the constitutionality of the individual mandate,` but also the Medicaid expansion because of the additional costs on the states.
In the ruling, the court said the federal government could not withhold Medicaid funds for existing programs in states that do not participate in the expansion.
Gov. Phil Bryant questioned whether Mississippi should participate in the expansion, and Lt. Gov. Tate Reeves concurred.
“An expanded Medicaid program would add almost 400,000 new enrollees and cost the state an estimated $1.7 billion over the next 10 years,” Reeves said. “Mississippi taxpayers simply cannot afford that cost.”
Reeves was referring to a study by Milliman, an internationally known actuarial firm that estimated the impact on Mississippi budget over a 10-year period to be between $860 million and $1.66 billion.
Leighton Ku, the director of the Center for Health Policy Research at George Washington University, said in an October 2010 memo that the Milliman study does not take into account the economic impact the infusion of federal Medicaid dollars will have on the state.
Under the law, the federal government will pay for 100 percent of the expansion for the first three years, beginning in 2014. The amount of the federal match will be stair-stepped down to 90 percent in 2020 where it will remain thereafter.
Ku writes the federal funds will flow to Mississippi health care providers that “will lead to higher state and local revenues which will offset much, if not all, of the new state costs.”
Insurance Commissioner Mike Chaney said there is a belief by some that under the Supreme Court ruling, states could opt into the expansion when the federal government was paying 100 percent of the costs and opt out or reduce the size of the expansion once the state was required to pay a portion of it.
Overall, Chaney said Mississippi is in a good position because it is ahead of most states in putting in place the state exchanges that are part of the new law. Under the exchanges people can shop for the best price for private insurance and receive better rates because they will be buying as part of a group.
“I think Mississippi is in the best place it can be in as far as compliance with the law,” Chaney said. “And the Supreme Court ruling as far as the Medicaid expansion gives us some options we did not know we had.”
Still, many of the state’s Republican leaders were disappointed with the ruling.
“Today’s decision by the U.S. Supreme Court to uphold Obamacare and its individual mandate is alarming,” Bryant said. “It is a stunning expansion of federal power and an assault on the liberty of American citizens.”
After the law was passed in 2010, Bryant was one of the first to challenge it in court. Former Gov. Haley Barbour entered the case on behalf of the state after Democratic Attorney General Jim Hood opted not to.
Hood said at the time he thought the law would be upheld and said, regardless, the issue would be fully litigated whether he entered and used the resources of his office.
On Thursday, Hood, said, “Although I have grave concerns over the abuse of federal power by corporations to preempt state law, doing nothing to keep the rising health care costs from bankrupting our country was not an option.”
bobby.harrison@journalinc.com