December 19, 2018
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Democrats, GOP continue fight over Medicaid expansion, hospital repayment

AUGUSTA, Maine — Republicans and Democrats on Tuesday continued to spar over linking acceptance of Medicaid expansion funds from the federal government with repayment of the state’s outstanding Medicaid debt to 39 hospitals.

Although both sides say there is no disagreement about finally paying off $484 million owed to Maine hospitals, the question of whether expanding Medicaid eligibility, which Democrats support and Republicans decry, will help contain health care costs has grown into one of the most contentious this legislative session.

Meanwhile, the federal government notified state officials Tuesday that Maine likely would receive 100 percent federal funding for three years to cover 10,500 childless adults who already receive some Medicaid coverage if Maine opted to participate in the expansion. That 100 percent rate would gradually drop to 90 percent by 2020.

It had been unclear whether that population would qualify for 100 percent federal funding starting next year or 81 percent. That 81 percent rate gradually would have risen to 90 percent by 2020. The federal government now covers 62.57 percent of costs for all Maine Medicaid recipients.

At issue was whether Maine provided full Medicaid coverage, known as “benchmark” coverage, to the 10,500 covered childless adults or whether the state provided coverage that fell below that standard. In a Tuesday letter to Gov. Paul LePage, Health and Human Services Secretary Kathleen Sebelius wrote that Maine’s coverage likely falls below the benchmark level, so the federal government would provide 100 percent funding for those childless adults.

Democratic legislative leaders called the news from the federal government a “game changer” in favor of expanding Maine’s participation in the federal Medicaid program as allowed under the Affordable Care Act. However, LePage’s spokeswoman, Adrienne Bennett, said Tuesday that the governor could not support any bill that linked repayment of the hospital debt with Medicaid expansion.

LePage administration officials still have weeks of work to do to negotiate details of a potential Medicaid expansion with federal officials before determining whether to pursue an expansion, Bennett said.

Mary Mayhew, Maine’s health and human services commissioner, plans to meet Thursday with Cindy Mann, the Medicaid director at the federal Centers for Medicare and Medicaid Services, to discuss Maine’s position on Medicaid expansion. Among the possible topics of discussion are questions about funding to cover certain parent groups and clarification of what the governor’s staff interprets to be contradictory information about the type of analysis Maine will have to provide to qualify for the expanded federal funding.

“This will not put to bed the issue of whether we will move forward with Medicaid expansion,” Bennett said of Tuesday’s letters. “We are not there yet.”

Mayhew said late Tuesday the letter from Sebelius didn’t address the central request she made in mid-March, when Mayhew asked for 10 years of full federal funding to cover Medicaid expansion costs, rather than the three years prescribed in law.

“We continue to be concerned that a state like Maine that expanded and has been covering these populations for more than a decade, that we are not getting the kind of financial assistance that is critical to our state given the financial challenges we continue to confront,” she said.

With Republicans calling for an up-or-down vote on LePage’s hospital repayment plan without any strings attached, Democrats late last week said they would support the plan if Republicans agreed to the Medicaid expansion under the federal Affordable Care Act. LePage, a Republican, reacted angrily to that proposal, accusing Democrats of reneging on an agreement to repay the state’s hospital debt.

As the Legislature’s Veterans and Legal Affairs Committee moved closer Tuesday to agreement on a bill to repay the hospitals, the debate about linking Medicaid expansion to that proposal escalated with Republican legislators echoing LePage’s accusation that Democrats were reneging on the repayment of hospitals.

“We are shocked and disappointed that this is a contentious issue yet again and that Democrats seem to be changing their minds yet again on paying the hospitals,” said House Minority Leader Kenneth Fredette, R-Newport, during a news conference Tuesday afternoon at the State House. “We must pass this bill on its merits with no conditions attached and with a clean up-or-down vote and we must do it as soon as possible.”

But Democrats said signing on to the Medicaid expansion makes moral and economic sense for Maine and is inextricably linked to repaying hospitals and in a broader sense reducing the state’s health care costs.

House Speaker Mark Eves, D-North Berwick, said the news from the federal government about the Medicaid expansion was a “game changer” for Maine.

“We know that as we pay our final payment to the hospitals, it’s been our position to make sure we do something that really addresses the cost drivers in our health care system so we’re not back here in the same spot,” Eves said during a news conference immediately after the Republicans’ gathering. “We have an opportunity to access these federal dollars to really address one of these cost drivers in our health care system and that is the charity care that hospitals provide. To not do these together would leave the job half done.”

Maine lawmakers have received conflicting analyses about whether the state would save money or end up spending more for Medicaid if it participated in the expansion. Mayhew said at the start of April that Maine would be penalized by the federal government for having expanded Medicaid coverage before the Affordable Care Act passed in 2010.

An analysis released late last year by the Kaiser Family Foundation projected Maine would be one of 10 states to see the amount of state funds it spent on Medicaid actually drop over the next decade — by $570 million, or 3.8 percent — while the federal share of Medicaid expenses would rise by $3.1 billion, or 11.4 percent.

The Kaiser Foundation predicted Maine’s Medicaid rolls would grow by about 55,000 — most of whom would be adults without children — if the state opted to expand.

U.S. Rep. Chellie Pingree, a Democrat who represents Maine’s 1st District, also weighed in. Pingree, who exchanged barbs last year with LePage over Medicaid coverage, said in a prepared statement that if Maine does not accept the federal Medicaid dollars, the state’s taxpayers will be subsidizing health care for residents of other states.

Assistant Senate Minority Leader Roger Katz, R-Augusta, said signing on to a Medicaid expansion now could end up being disastrous in the long term.

“If we were to pass Medicaid expansion today, Gov. LePage has zero negotiating leverage with the federal government,” said Katz. “Let’s give him the opportunity to negotiate the best deal he can for Maine. Maybe he’ll fail but he may succeed in saving us tens of millions of dollars and that’s why it’s particularly dangerous from my perspective to couple these things together now.”

Senate President Justin Alfond, D-Portland, said Maine can always renegotiate its deal with the federal government at a future date.

“The thing that Democrats want and the Maine people want is lower health care costs,” said Alfond. “This is just Republicans distracting all of you and the state of Maine from understanding why Republicans will not vote for expansion. … I am completely just surprised that they are going against the will of the people. It’s an economic decision. It’s a moral decision.”

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