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Utah Governor Vows Fight After House Nixes Medicaid Plan

By Rebecca Adams, CQ Roll Call

March 6, 2015 -- The Utah State House may vote soon on a narrower Medicaid expansion plan than the proposal put forward by Republican Gov. Gary Herbert. The debate got more intense this week when Herbert vowed to "continue to fight" for his proposal despite a key House committee's rejection of his plan.

Herbert's measure, known as Healthy Utah, passed the state Senate late last month but then failed on to make it out of a House committee. The panel instead approved the alternative, which costs almost as much as Herbert's plan but covers a much smaller population. The House bill would bring in a much smaller pot of federal matching grant money the governor's plan.

"Healthy Utah is finished," said Chuck Gates, a spokesman for House Speaker Greg Hughes, in an email last week. "It won't be voted up or down on the floor."
But Herbert said he will continue to push the Senate to support his bill and told reporters at a press briefing that calling a special session to consider it is "an option." The current regular session is expected to end in mid-March.

When asked last week if his plan is dead, Herbert retorted, "I'm not dead and I can tell you that I will continue to fight for the taxpayers of Utah."

Herbert said he is willing to make some modifications to his two-year pilot project to address concerns about the fiscal sustainability of his measure.

"The fight goes on," said Herbert. "There may be other ways to do it and certainly we want to work with the legislature."

Herbert also said that he is open to suggestions floated by some lawmakers to approve both Healthy Utah and the rival plan, with one taking effect for a couple of years and the other being implemented later if the original plan doesn't work well. But Herbert insisted that Healthy Utah should be implemented initially and that the narrower plan be available as a fallback option of costs turn out to be too high.

Herbert said that his program could be capped so that if costs exceed expectations, new applicants would not get the same benefits as people who were already enrolled and would be grandfathered into that level of coverage. Herbert won assurances from Health and Human Services Secretary Sylvia Mathews Burwell that the unusual cap would be approved.

The governor also sought to portray the House version as the fiscally unsustainable option. Because that bill would not expand Medicaid under the health care law, it would attract fewer federal dollars.

The health care law provides a generous matching rate to states that expand to the population that Obama administration officials want. The administration will cover all of the costs through 2016 for people who qualify under expanded eligibility guidelines if states broaden the population to anyone with income up to 138 percent of the federal poverty level. That full financing phases down until the federal Department of Health and Human Services will cover 90 percent of the costs for those people starting in 2020.

The alternative House plan—sponsored by Utah House Majority Leader Jim Dunnigan, the chamber's second-ranked Republican—would not meet the federal requirements for the 100 percent federal matching money.

Dunnigan's measure would cost $56 million in state revenues and draw down $139 million in federal matching grants in 2021, according to House legislative estimates. The program would cover an additional 32,000 adults with comprehensive care and provide basic care to 61,000 adults. The estimates include people who qualify under previous eligibility guidelines but learn of benefits and enroll for the first time.

The governor's version would cost $78 million in state funds while attracting $648 million in federal matching money in 2021. It would cover about 146,000 people
Under Utah legislative rules, it would be rare for Dunnigan's bill and Herbert's plan to be reconciled in a conference committee.

"You can never say never, however," said Gates, the spokesman for House Republicans. "And Rep. Dunnigan is never one to close a door."

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