The New York Times’ Robert Pear had a fantastic article on December 27, 2015 describing the great shutterstock_344371520-compromise.jpgphilosophical divide emerging between congressional Republicans, who are opposed to Obamacare and Medicaid expansions at any cost, and the more moderate Republican Governors, who have favored some form of Medicaid expansion.
While just a little over half of all states have expanded Medicaid pursuant to the Affordable Care Act (ACA), as Pear notes activity among Republican Governors advocating for some type of expansion is much more robust than one might otherwise think. Pear chronicles the fact that Arizona, Arkansas, Indiana, Iowa, Michigan, Nevada, New Jersey, New Mexico, and Ohio’s GOP Governors expanded Medicaid or defended past expansions since the ACA was passed. Additionally, still more are pushing past failed efforts, proposing to expand Medicaid further, or reconsidering past opposition. The states among them include Tennessee, South Dakota, Utah, and Alabama.
The Governors’ supposed contrarian stances stem from a few issues, including more moderate political outlooks, challenging state budget climates, the chance to maximize federal revenue, the ongoing effects of a lagging economy, and some negative changes in benefits, premiums and costs in the Exchanges that have occurred and are impacting residents.
In our end of year Strategic Insights, we predicted that Medicaid would likely see expansion in 2016. With the presidential torch to be handed off in early 2017 and CMS’ frustration with the half a loaf it got with Medicaid expansion, we said that CMS may finally change its approach on Medicaid expansion under ACA and consider expansions and pilots that represent eligibility levels short of 133% of the federal poverty level. Our thought is that CMS might finally sacrifice its ideology (much as the Republican Governors have) and agree that some expansion for all residents, say to 100% of the federal poverty limit (FPL) as opposed to the intended 133% in ACA, might just be the right compromise right now.
We believe this is the best policy for the nation for a number of reasons:
- It overcomes GOP opposition in many states where lawmakers rationally fear “woodworking” costs in the near term and the diminishing federal revenue toward the end of this decade when states take on some costs of a Medicaid expansion. Allowing a lower FPL increase could be enough to overtake states’ opposition and concern about affordability.
- Allowing a Medicaid expansion in states to 100% of the FPL would create seamless access to health care benefits for all Americans. In those states that choose 100% of Medicaid, residents would be in Medicaid. And, since the law allows those in states that have not expanded Medicaid above 100% to access the Exchanges, no one would be in a so-called donut hole without access to either Medicaid or Exchange coverage.
Whatever one thinks of Obamacare as a national policy, the law seems to be here to stay. It seems illogical and fundamentally unfair that a resident of a non-expansion state just below 100% of poverty has no access to healthcare via the Medicaid program while one just above 100% gets a 98% premium subsidy and additional cost-sharing help through the Exchanges.
The inequity calls for swift compromise in 2016.