In wall of GOP Medicaid expansion opposition, a crack appears

Mark Eves in September.
Christopher Cousins
Mark Eves in September.
Posted Jan. 15, 2014, at 10:04 a.m.
Last modified Jan. 15, 2014, at 5:12 p.m.

AUGUSTA, Maine — The House’s top Democrat on Wednesday morning presented what he called a “compromise” bill to expand Medicaid in the state to roughly 70,000 of the poorest Mainers.

It’s the first glimpse at what Democrats, who hold a majority in the Legislature, hope will be a bill that can gain enough Republican support to override a near-certain veto from Gov. Paul LePage.

And it looks familiar: The key provisions meant to entice Republicans come straight from an amendment offered in the 11th hour of last year’s session by Assistant Senate Minority Leader Roger Katz, R-Augusta.

The new bill, LD 1578, is sponsored by House Speaker Mark Eves, D-North Berwick, and picks up where Katz’s bill left off. It was presented at a meeting of the Health and Human Services Committee, during which dozens of expansion friends and foes testified.

The bill would accept federal money to expand the state’s Medicaid program, MaineCare, to all individuals with incomes under 138 percent of the federal poverty level. The federal government has vowed to pay the full cost of expansion for three years, during which time the state would incur some administrative costs, before slowly ratcheting down to 90 percent federal funding thereafter.

Those three years set the stage for the main compromise presented in Eves’ bill: A sunset provision.

Opponents of expansion have questioned whether the state would realize the dramatic savings and benefits Democrats promise. Eves said that by sunsetting the expansion after federal funding drops from 100 percent, a future Legislature would have a chance to assess the pros and cons of expansion.

“After three years, prior to the decline in federal funding going to 90 percent, the Legislature would have to take a proactive step, and the good news is we’d have the experience of those three years to help make that decision,” Eves said.

The three-year sunset was also in Katz’s bill. Other provisions that seek to address Republican concerns include:

— An opt-out provision that would allow the state to cancel expansion efforts if the federal government reneges on its commitment to pay. Republicans, including LePage, have been skeptical about Washington’s promise to pay in the wake of federal sequestration and shutdown.

— A provision to require some new MaineCare enrollees to make the maximum allowable co-payments.

— The creation of a “MaineCare Stabilization Fund,” which would direct any savings from Medicaid expansion toward future costs.

As he was last year, Katz will likely be a key player in any eventual deal that may come on Medicaid expansion. Even if every Democrat and independent in both chambers votes for expansion, they’ll need to win over at least four Republican senators and eight GOP representatives.

On Wednesday, Katz said he’s engaging in talks with Republicans and Democrats alike about how to get the deal done. He hinted at an amendment to Eves’ bill in the coming days, but is keeping the details close to his chest.

“I’m still hopeful that we can find some middle ground on the issue and that we can further amend it to honor some sound Republican principles,” he said.

Medicaid costs have grown steadily at a rate of 3.2 percent since 2008, according to the state’s Office of Fiscal and Program review. Katz said addressing that growth is the key to a deal that Republicans could support.

“The details of how that may be embodied in an amendment will have to wait, but clearly the major problem facing the Medicaid program is the increasing cost year-over-year. The question is what we can do to stem that cost growth in a meaningful way.”

Part of that equation might be the implementation of some aspects of “cared-management” into the state’s Medicaid program. Katz will present a carryover bill from last session to the Health and Human Services Committee on Thursday, and said that cared-management is one way to address rising MaineCare costs.

Under that model, MaineCare recipients would receive all or most of their health care from an organization under contract with the state. That provider would be paid per member covered, rather than per service provided.

Katz and other proponents say such a payment system, as well as strict accountability standards, would create incentives for preventive care and lower costs.

Eves said Wednesday that he and his Democratic partners are willing to consider any proposal that would win support for accepting the federal money and providing health coverage for 70,000 low-income Mainers.

“We’re open to whatever proposals, and considering those that are going to get us there,” he said. “We need to see the details of any proposal before we commit to anything.”

While Katz and a handful of other Republicans appear to be looking for a way to leverage their support to get cost-saving measures, many others remain steadfast in their opposition to expansion, which they say will cost the state hundreds of millions of dollars over the next 10 years.

Rep. Deborah Sanderson, R-Chelsea, listened to hours of testimony on Eves’ bill during Wednesday’s Health and Human Services Committee hearing. She said the portion of Mainers living at between 100 and 138 percent of the poverty level should be directed to the new private insurance marketplace created by the Affordable Care Act.

There, they would receive subsidies that could result in monthly insurance premiums as low as $5, and their private insurance would pay Maine’s hospitals more than MaineCare.

But that still leaves about 36,000 childless adults making less than the federal poverty limit who fall into the so-called “coverage gap,” without Medicaid or subsidies on the marketplace.

Sanderson said the needs of those Mainers would have to be addressed, but that the state can do better than expansion. She noted a 2002 expansion of Medicaid that Republicans say resulted in millions of dollars of debt to Maine’s hospitals and no noticeable decline in health care spending.

“We understand they are definitely a population that needs to be addressed,” she said. “We can explore different options. It doesn’t have to be the one-size-fits-all Medicaid expansion they’re proposing.”

Other Republicans balked at the characterization of Eves’ bill as a “compromise.”

House Minority Leader Ken Fredette, R-Newport, said the idea that this Legislature would extend benefits to thousands of Mainers only for a later one to take that benefit away was unlikely.

“I acknowledge the attempt to fashion something that is palatable, but the issue is this is giving a benefit to 70,000 people and then trying to suggest the Legislature might take it away at a future date,” he said. “Once you give a benefit to someone, it’s extremely difficult to take it away.”

The staunchest opponent remains LePage, who in a weekly radio address Wednesday reiterated that Medicaid expansion is too costly, citing the $807 million 10-year price tag estimated by the Alexander Group, a consultant whose work Democrats have criticized as being guided too much by conservative ideology.

“Maine already has the third-highest spending on Medicaid in the nation,” LePage said. “Expanding is not affordable.”

Follow Mario Moretto on Twitter at @riocarmine.

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