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On Medicaid: One State Moves Closer to Expansion, One Stalls

By Rebecca Adams, CQ HealthBeat Associate Editor

May 17, 2013 -- Arizona senators moved Medicaid expansion one step closer to reality in that state this week while the effort fell short in Michigan.

Both states are led by Republican governors who announced earlier this year that they support expansion.

In Arizona, the Republican-led Senate voted last week to include provisions in the state's $8.8 billion budget that put in place GOP Gov. Jan Brewer's proposal to expand Medicaid coverage to people with income up to 138 percent of the federal poverty level, as called for in the health care law. The issue now goes to the Arizona House, where the prospects are less clear. Arizona's fiscal year starts July 1.

"When I announced my health care plan in January, I knew this would be a long and difficult road," Brewer said in a statement. But she added that public polls show "strong support for my Medicaid Restoration Plan across party lines and among residents from every corner of our state." If the state legislature chooses to broaden the program, Brewer said, "We can keep Arizona tax dollars in Arizona. We can use these resources to provide cost-effective health care to Arizona's working poor. We can protect our critical rural and safety-net hospitals. We can create thousands of jobs and improve Arizona's economic competitiveness."

The situation is more complicated in Michigan. The Republican-led Senate on last week narrowly approved a budget bill that doesn't broaden Medicaid eligibility. The House has already passed a budget measure without the expansion. Some Medicaid advocates hope that it could re-emerge in legislation separate from the budget process, which will wrap up in the next few weeks. The fiscal year in Michigan starts Oct. 1.

Some Michigan House Republicans are considering a bill that would expand Medicaid but it includes limits on the numbers of years that people could receive Medicaid, something the Obama administration is not likely to approve.

Similar ideas have been floated in Ohio, another state in which a GOP governor supports the expansion but the legislature has not acted. In that state, one idea that some Republicans are pushing is the notion of time limits. Others like the idea of spending Medicaid dollars to pay for coverage in the new marketplaces that will start enrollment in October, in a manner similar to what Arkansas has proposed.

Republican governors have been influenced by lobbying from local employers and health industry officials, such as hospital administrators. They also like the fact that the federal government will pick up the full tab for the first three years, although the federal contributions scale down to 90 percent in 2020.

However, many GOP legislators see the vote on Medicaid expansion as their last chance to vote against a part of the health care overhaul for philosophical and political reasons.

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