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Virginia lawmakers carefully consider Medicaid growth

February 27, 2013 3:47 pm by: Category: Health Care A+ / A-



Wednesday, February 27, 2013


If Medicaid is expanded in Virginia, it likely will happen only with serious tinkering by state lawmakers.

As part of a budget bill that keeps the proposal alive, the General Assembly over the weekend created a legislative commission that will determine how Virginia applies one of the key provisions of the new federal health care law.

Under the Patient Protection and Affordable Care Act, states have the option of broadening Medicaid eligibility so that more low-income individuals are covered by the government insurance program.

But rather than accept the idea — and the federal funding that comes with it — outright, the General Assembly has made it contingent on whether suggested improvements to the federal proposal are deemed acceptable by the state commission.

That process will take months to play out, raising questions about whether the state will meet the Affordable Care Act's goal of having the expansion in place by Jan. 1, 2014.

"Even under the best of circumstances, that's not going to happen in Virginia," said Katharine Webb, senior vice president of the Virginia Hospital and Healthcare Association .

A more likely scenario is that expanded Medicaid benefits would not be available until at least July 1 of next year — and even that is not guaranteed, said a representative from a citizens' advocacy group that has pushed for the expansion.

"It's not as good a deal as I would have liked," said Ray Scher , a board member of the Virginia Organizing Project.

But given the strong opposition by some legislators, he said, "I think we've done very well to get this far."

Critics of the Medicaid expansion, part of the sweeping health care law championed by President Barack Obama, have said the proposal needs to allow states more flexibility to make changes, in part to ensure greater cost savings.

They also wonder whether the debt-ridden federal government will be able to deliver on its promise of billions in funding to the state.

So by the time the General Assembly formed a legislative commission to sort out the details, talk of expanding Medicaid had shifted to talk of reforming the expansion.

"Medicaid is the fastest-growing item in the state budget, and Medicaid expansion without significant reforms could wreck Virginia's finances," Del. John O'Bannon, R-Henrico County , said in statement Sunday after being appointed to the commission.

"We need to make sure that patient-centered, cost-saving reforms are fully implemented before we think about moving forward," said O'Bannon, a practicing physician.

O'Bannon is one of four House Republicans and one Democrat appointed to the commission. At least one other member has also voiced concerns similar to O'Bannon's.

"I have serious concerns about the costs of Medicaid expansion," Del. Jimmie Massie, R-Henrico County , said in an announcement of his appointment to the Medicaid Innovation and Reform Commission.

Medicaid expansion will move forward in Virginia only "if the Commission determines that the conditions for reforms have been met," according to budget language adopted by legislators.

That would happen by July 1, 2014, "or as soon as feasible thereafter," the budget amendment states.

The 12-member commission, consisting of 10 legislators and two non voting state officials, is not expected to meet until June.

At least three House and three Senate members on the commission must vote to approve any expansion.

"It doesn't happen overnight," Webb said of the proposed reforms that have yet to be addressed by the commission. "There's no magic bullet to this, but it's something that's clearly worth pursuing, because the numbers are so compelling."

Normally, the costs of Medicaid are shared equally between the state and federal governments.

To cover the costs of expanding the program, the federal government is promising to pay 100 percent of the costs for those added to the program for three years, starting in 2014. The portion of federal funding would decrease to 90 percent by 2020.

Under the expansion, those making up to 133 percent of the federal poverty level would be covered,

Medicaid, which mostly covers low-income children, parents, pregnant women and the disabled in Virginia, would reach more of the working poor, including adults with no children, under the proposed expansion.

"These people aren't takers from the system," Scher said. "They are just people who need help."

About 400,000 additional low-income Virginians with no insurance would be eligible for Medicaid under the expansion, although it's estimated that about 250,000 would actually enroll.

All told, Virginia would receive about $23 billion in federal funds to help pay for the expansion.

But as critics are quick to point out, that promise could go unfilled, with the state left holding the bag.

"Our country is slowly drowning in a sea of red ink," said Sen. Bill Stanley, R-Franklin County. "Expanding the Medicaid program in Virginia on a promise from the federal government to continually subsidize the program would certainly be foolhardy."

But by delaying past the first of next year, Scher countered, Virginia will be missing out on $5 million in federal funds a day committed to the expansion.

Scher sees the state's current approach to Medicaid expansion as similar to one taken by opponents to the Affordable Care Act as it moved through Congress and later legal challenges.

"They waited out the passage of the law, they waited out the Supreme Court decision," he said. "And it just seems like they want to wait it out again."

Staff writer Michael Sluss contributed to this report.

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