The last week has yielded significant progress in several states currently debating Medicaid expansion. Thirty-one states and DC have already expanded the program, made an option for states due to the Supreme Court’s NFIB v Sebelius decision. Many state legislatures are coming back into session from summer recesses bringing into focus discussions on the budget implications of Medicaid. Additionally, as we approach a looming Presidential election with expected high voter turnout, politicians have an opportunity to push for the expansion to gain support from certain stakeholders. While significant action is needed in each of these states before any Medicaid expansion legislation is passed or their governors act to implement their plans, it is worth keeping an eye on all of these states in the coming months.
Utah- It has been over a year and a half since Governor Herbert announced his support for Medicaid expansion. This week, details of the new plan, UtahAccess+, have been released. The plan, formulated by the Governor and Republican legislative leaders, is similar to the Healthy Utah plan that was passed the Utah Senate but was struck down in the House with the exception of the financing model which puts the burden on providers that would benefit from additional funds through expansion.
Louisiana- This is one of the more surprising states to appear on a list of upcoming states to expand Medicaid, however the tides may be shifting in this largely conservative state. Louisiana is in the process of electing a new governor as Presidential candidate Bobby Jindal is ineligible due to term limits. All four candidates have indicated some level of support for expansion (to varying degrees) since April. These candidates’ positions reflect the push by business groups in the state which have called for expansion, as well as the recent legislative change that gave the new governor the necessary state authority to expand in the first months in office.
South Dakota- Republican Governor Dennis Daugaard recently met with HHS Secretary, Sylvia Burwell to discuss a plan for the state to extend coverage contingent on the federal government bearing the responsibility for certain Indian Health Service payments.
Wyoming- Republican Governor Matt Mead has pushed for Medicaid expansion throughout 2015, but it has so far failed to pass through the state’s Republican legislature. The state is facing budgetary pressures for the first time in recent years as revenues from gas and oil decline. Mead is using the latest financial pressures as an argument for accepting the federal revenue to provide insurance to low-income residents.
One concern of many state legislatures is how the state will finance the Medicaid expansion. Beginning after 2016, states will be required to contribute toward the cost of the newly eligible expansion population. One emerging theme from these state expansion plans is to finance the expansion directly from providers, either through taxes or fees on hospitals, providers including home health agencies, or managed care plans. This method of paying for the state’s share of Medicaid expenses is not uncommon. Alaska is the only state that does not impose some tax on providers. Even Delaware, which has historically been adverse to Medicaid-related provider fees, has recently implemented taxes on nursing facilities and long-term care providers. Whether this method of financing the Medicaid makes the decision to expand Medicaid more palpable for state lawmakers remains unclear. However, at this point providers have not raised very much significant opposition. This is likely because the revenue that providers will see from expansion exceeds the taxes proposed as part of these expansion plans.