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Election Could Shift Medicaid Expansion Policy in Some States

By Rebecca Adams, CQ HealthBeat Associate Editor

October 30, 2014 -- Election Day could jolt the dynamic in a handful of states that have not embraced an expansion of Medicaid.

Twenty-three states have yet to expand Medicaid eligibility under the health care law. Two, Indiana and Utah, have governors who support some type of expansion but are either mired in negotiations with the Obama administration or trying to persuade holdout state legislators to support the idea.

Governors' races in a handful of other states could shift policies on the federal–state health program for low-income people. In most states, governors also have to work with the legislature, which could make implementation difficult if legislators don't agree with eligibility changes.

That's already been the case in Utah, where Republican Gov. Gary R. Herbert recently struck a deal on a memo of understanding with federal officials to expand the program but encountered resistance from House Speaker Becky Lockhart. Lockhart is leaving the legislature and health policy advocates are watching closely to see who will replace her. Expansion advocates are rooting for Republican Greg Hughes.

The legislature and existing state laws would be an obstacle in two tight governors' races where Democrats have a chance to defeat the GOP incumbent.

If state Sen. Jason Carter, a grandson of former President Jimmy Carter, were to unseat Republican Gov. Nathan Deal in Georgia, Carter would have to persuade a Republican-controlled legislature to change a recently-passed state law blocking Medicaid changes.

The Democratic challenger in Kansas, House Minority Leader Paul Davis, would face a similar challenge in the Republican-dominated legislature if he were to defeat Republican Sam Brownback.

In many states, Republicans supporting expansion have argued that accepting the federal money available for such changes is different than endorsing the health care law completely. Nine GOP governors have already gotten federal approval to bring more people into the system under the statute (PL 111-148, PL 111-152), which permits states to broaden eligibility to people with income of up to 138 percent of the federal poverty level. The poverty level is $11,670 for an individual this year and $23,850 for a family of four this year.

A number of other GOP governors, including those in Tennessee and North Carolina, have said they are willing to consider expansion.

The federal government will cover all of the costs of people who become eligible because of the expansion through 2016. After that, the federal share phases down until it is 90 percent of costs in 2020 and thereafter.

A look at other states with Medicaid policies in play:

Florida. Democratic candidate Charlie Crist has said that he'll push for expansion and would resort to executive action if the Republican-led legislature balks, as in the past. If he were to succeed, about 1 million Floridians would gain coverage. 

Political science professors in the state doubt that Crist has the authority to carry through on the threat, but said that because Crist elevated the issue, he may feel compelled to fight for it, if elected.

"It's not clear that he does" have that power, said Sean Foreman, associate professor of political science at Barry University in Miami. "But it wouldn't stop him from trying."

Crist may find, as Virginia Democratic Gov. Terry McAuliffe did this year, that he has less authority to expand Medicaid benefits unilaterally than he first thought.

Crist cited the experience of Ohio Gov. John Kasich, who circumvented the opposition of lawmakers by tapping an arcane budgetary board, known as the controlling board, to approve the decision a year ago. In states such as Pennsylvania, the governor did not need legislative approval to move forward on expansion. Foreman said that Florida has a relatively weak gubernatorial office and does not have a controlling board.

"It's not likely that Crist could do the same thing, but he may have another creative method of implementing this if he's determined to do it," said Foreman. Crist previously served as state attorney general and as governor.

"Sometimes governors take an 'I'm going to do it and sue me later' approach," said Drew E. Altman, president and CEO of the nonpartisan Henry J. Kaiser Family Foundation.

The outcome in Florida for Medicaid will take some time to sort out.

"Coverage for a lot of people is at stake—hospitals want it, the new governor would want it —but you're still dealing with a pretty conservative legislature," said Altman.

If current GOP Gov. Rick Scott wins another term, it's unlikely that the state would broaden eligibility, said Florida State University political science professor Carol S. Weissert. Scott has said that he supports expansion. But Weissert said Scott has "not lifted a finger" to push the legislature to accept it, "and I've seen no evidence he'd change his mind. Most of the advocates are banking on Crist."

Weissert said that the election might result in a somewhat more favorable atmosphere in the conservative state House, which stood in the way of discussions about expansion. The Florida state Senate had been exploring the type of expansion in which Medicaid dollars are used to pay for private plans in the marketplace. Arkansas, Iowa, Michigan and Pennsylvania have won federal approval for such an approach. Virtually all of the states that might consider expansion in the future would be most interested in that type of plan.

Maine. The battle lines are clear in Maine, where Republican Paul R. LePage has vetoed Medicaid expansion bills sent to him by the legislature five times. Democratic challenger Rep. Michael H. Michaud has said he will support those measures.

"Medicaid expansion will depend on whether Paul LePage wins reelection," said University of Maine political science professor Amy Fried.

The legislature is controlled by the Democrats. In the Senate, Democrats currently have a four-seat margin, but some Republicans have crossed over to support expansion.

"The legislature has tried to override his veto and came close," said Georgetown Center for Children and Families Executive Director Joan Alker.

In the most recent override attempts in June, the House held a pair of votes designed to win the two-thirds supermajority needed to pass the bill without LePage's signature. In the first effort, the House fell two votes short; in the second, three votes short.

Maine is the only state in New England that has not widened Medicaid eligibility to more adults. Neighboring New Hampshire, the most recent to win approval from federal officials, began its expansion this summer.

Polls show the race is extremely tight. Michaud may get a boost from recent comments by third party candidate Eliot Cutler, who is now telling his supporters to vote for one of the other candidates if they don't think he can realistically win, and from Independent Sen. Angus King, who switched his endorsement from Cutler to Michaud last week.

Wisconsin. One of the first issues that Democratic challenger Mary Burke raised after announcing a challenge to GOP Gov. Scott Walker was Medicaid. However, she would probably have to work with GOP majorities in the House and Senate.

Last year, Walker staked out a unique position on the program. Wisconsin had expanded Medicaid under then-Gov. Jim Doyle, a Democrat. Walker scaled back eligibility guidelines so that the state would cover people up to the federal poverty level but no one above that. As a result, tens of thousands of Wisconsin residents lost BadgerCare, the state's Medicaid coverage.

The state is paying about 40 percent of the costs for some adults that the federal government would initially cover entirely if the state were to accept the expansion.

Although Burke has prioritized an expansion, it is unlikely that legislators will allow her to scuttle Walker's policies.

"Even if Mary Burke were to be elected, there's not much chance of reversing Scott Walker's policy on Medicaid extension," said University of Wisconsin at Madison political science professor David Canon. "Given that political reality, the status quo is basically what we're looking at."

Dan Mendelson, CEO at the Avalere Health consulting firm, called this year's campaigns "a key election for the future of the Medicaid program."

"Expansion will depend on both the outcomes of the governors' races, as well as state legislative balance, as state legislatures often hold the keys," said Mendelson.

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