Starting in 2014, under the controversial federal legislation, people earning up to 138 percent of the federal poverty level – roughly $15,000 annually – can receive health care coverage through Medicaid in states that opt to participate in the program.
For the first two years of the program, the federal government will pay 100 percent of the costs. The percentage of the coverage paid by the federal government will stair step down to 90 percent by 2020.
While states can opt in or out of the program at any time, to take full advantage of the program when the federal government is paying all the costs, legislators need to act in 2013 – presumably during the regular session that starts Jan. 8. Gov. Phil Bryant could call a special session to deal with the issue, though that is not likely because he has made it clear that he is against the expansion of Medicaid.
“I stand firm in my position that this law is bad for our nation, financially unsustainable and tramples our rights as citizens,” Bryant wrote in his budget narrative. “... Personal principles aside, we just cannot afford to expand the Medicaid program.”
Others claim the state cannot afford not to participate in the expansion. Ed Sivak, executive director of the Mississippi Economic Policy Center, said the expansion will benefit the state’s economy by infusing literally billions of federal dollars into health care that will create thousands of jobs and by creating a healthier work force that will be a lure for companies looking to expand.
“Failure to expand places us at a competitive disadvantage,” Sivak said recently.
House Appropriations Chairman Rep. Herb Frierson, R-Poplarville, said he opposes the expansion. His counterpart in the Senate, Rep. Buck Clarke, R-Hollandale, said he generally opposes the law, but wants to know more about how the federal legislation impacts Mississippi hospitals.
Under the federal law, the payments hospitals receive for uncompensated care are scheduled to be reduced over a period of time under the assumption that most people will have health care insurance either through the Medicaid expansion or through other provisions of the Affordable Care Act.
According to the Mississippi Hospital Association, about $315 million of care is not reimbursed each year to the state’s hospitals after the federal payments to the state of $210 million for uncompensated care.
Clarke said there might be a court challenge to the federal government’s plan to phase out the payments for uncompensated care. But if the payments are not restored to the hospitals, it could mean pressure on legislators to reconsider the Medicaid expansion.
“I opposed Obamacare from the beginning, and I continue to believe the state cannot afford an expansion of Medicaid,” said Republican Lt. Gov. Tate Reeves. “I am meeting with health care providers to learn exactly how this law will impact them.”
Reeves said there are still many unknowns and the federal government is still crafting the regulations to enforce the Affordable Care Act, also known as Obamacare.
“The Senate will not rush to a decision until more facts are known,” he said.
Rep. Steve Holland, D-Plantersville, said even if the Republican leadership kills legislation dealing with the issue in committee, he believes there will bills that will make it to the floor that can be amended to include the expansion. Holland said he will offer those amendments.
“I want to force the members to go to the board to vote green or red on this,” he said. “We need to debate it. It is too important to the people. It is too important to the economy of this state.”
The Medicaid program in Mississippi provides health care coverage to poor pregnant women, poor children, the disabled and certain segments of the elderly population. Currently, about 740,000 Mississippians are covered by Medicaid or by the Children’s Health Insurance Program, which provides coverage to a segment of the working poor.
For people covered by the existing Medicaid in Mississippi, the federal government pays about 74 percent of the costs, though it pays a smaller percentage of the administrative costs.
One study commissioned by Bryant’s Division on Medicaid said under the expansion, between 220,000 and 370,000 new enrollees will be added to the program at a cost to the state of between $609 million and $1 billion during the 2014-20 time frame.
Sivak points out the study concedes that many of those costs are because of mandates in the law that the state must comply with whether it expands Medicaid or not.