LePage vetoes Medicaid expansion, calls the effort ‘ruinous’ for Maine’s future

Gov. Paul LePage
Troy R. Bennett | BDN
Gov. Paul LePage Buy Photo
Posted April 09, 2014, at 4:01 p.m.
Last modified April 09, 2014, at 7:13 p.m.

AUGUSTA, Maine — As expected, Gov. Paul LePage on Wednesday vetoed a bill that would expand Medicaid coverage to roughly 70,000 low-income Mainers and dramatically overhaul the administration of the program by outsourcing it to managed care organizations.

The Legislature gave final enactment to the bill on March 28, starting a countdown for LePage to sign the bill, veto it or let it go into law without his signature. Wednesday was the deadline day. It was the third time LePage has vetoed Medicaid expansion in the 126th Legislature.

LD 1487 was presented by moderate Republican Sens. Roger Katz of Augusta and Tom Saviello of Wilton as a compromise effort to bring more of their party on board with expansion — the top priority for legislative Democrats.

In his veto letter to the Legislature, LePage referenced previous Medicaid expansions in Maine and said further growth in the publicly funded health insurance program would be “ruinous.”

“Maine has been down this road before, and we must learn from previous experience,” he wrote. “Medicaid spending grew by $1 billion in a decade, hospital bills were not being paid by the state, budgets were broken and thousands of elderly, and people with disabilities were forced to wait for critical services.

“For the sake of the truly needy and Maine taxpayers, we cannot go down this path again,” he said.

A provision of the federal Affordable Care Act, sometimes referred to as Obamacare, allows the states to expand Medicaid, known here as MaineCare, to every resident who makes less than 138 percent of the federal poverty level, or just under $16,000 per year for a childless, single adult. The federal government will pay the full cost of expansion through the end of 2016. After that, it’s share of the cost will drop, incrementally, to 90 percent.

Expansion was a linchpin in the federal health care overhaul, which envisioned state-funded health care for the poorest Americans and subsidized private health insurance plans, through new online exchanges, to anyone making between 138 percent and 400 percent of the federal poverty level.

But the U.S. Supreme Court in 2012 struck down the provision of the law requiring Medicaid expansion, leaving the decision up to each state.

The Democrat-controlled Legislature in Maine approved expansion twice last year, only to be thwarted by LePage’s veto. Overriding the governor would require two-thirds support in the Legislature — a threshold impossible to reach without Republican support. The overwhelming majority of GOP lawmakers, however, have stuck with the governor.

On Wednesday, Democrats called LePage’s veto “ideological” and urged Republican counterparts to join them in an override.

“We have a bipartisan plan for life-saving health care for tens of thousands of Mainers. It creates jobs, it saves lives, it saves money,” said House Speaker Mark Eves, D-North Berwick, who has championed the expansion effort for two years.

“Gov. LePage continues to stand in the way despite our good-faith effort to collaborate and address concerns raised by opponents [of expansion],” he said.

The Katz-Saviello plan attempted to win over Republicans by combining expansion with a plan to mandate big savings by outsourcing the publicly funded health insurance program to managed care organizations.

On paper, the bill addresses many of the concerns Republican opponents of expansion have raised for two years: The expansion lasts only as long as the federal government pays for nearly 100 percent of the cost, and it would require a vote of the Legislature to continue beyond that. It also includes an automatic opt-out if federal funding drops below promised levels. The Legislature’s nonpartisan budget analysts say the cost of the proposal is minimal.

It also uses built-in savings to clear out a waiting list of Medicaid recipients awaiting in-home and community services, which opponents have said needs to be addressed before the program is expanded to include all of Maine’s poorest residents.

That portion of the bill may become redundant if the Legislature approves a supplemental budget approved early Tuesday morning by the Appropriations Committee, which also funds the elimination of the waitlists.

Still, the bill struggled to gain Republican support, with many members of the GOP wary of expanding a program that already constitutes about a quarter of the General Fund budget, and which they say is “cannibalizing” other state programs.

LePage and the GOP also have said costs to the state will be far greater than predicted, though the numbers cited have come under intense scrutiny from Democrats and health policy analysts.

In the Senate, Katz and Saviello were the only members of their caucus to support the bill. Even Sen. Patrick Flood, R-Winthrop, who voted for Medicaid expansion last year, opposed the measure. In the House, just four of the 58 Republicans joined the majority in supporting the bill.

If those numbers hold, it is unlikely the Legislature will be able to override LePage’s veto. But the issue may not be dead yet: Two other bills aimed at expanding Medicaid — one by Eves and another by Senate Majority Leader Troy Jackson, D-Allagash — are still waiting in the wings.

Follow Mario Moretto on Twitter at @riocarmine.

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