Keeping an eye on Medicaid expansion in Virginia

Virginia’s long-running debate about whether to expand Medicaid has new life after a Democratic wave in last year’s election, in which several successful candidates campaigned directly on the issue.

Republicans still control both chambers of the General Assembly but have softened their opposition to expansion after years of steadfast denial. GOP House Speaker Kirk Cox opened the door to a potential bargain with new Gov. Ralph Northam on a stalled Democratic priority last month by saying House Republicans were “willing to begin a dialogue on health care” but still oppose a straightforward expansion.

“There’s a lot of momentum that we haven’t had,” said expansion advocate Jill Hanken, with the Virginia Poverty Law Center.

But there’s still little clarity on whether Medicaid will be expanded and, if so, in what form as the 2018 session hits its halfway mark. Northam (D), lawmakers, lobbyists and others expect that a final resolution won’t be reached until near the end of the legislation session next month.

Here’s some key background and what to watch as the issue makes its way through the General Assembly.

The stakes

The state estimates that nearly 400,000 low-income adults who don’t qualify for other types of public health assistance would be newly eligible for Medicaid.

Virginia estimates only about 300,000 people would actually sign up for the coverage. The cutoff is 138 percent of the poverty level, which is about $30,000 a year for an adult in a three-member household.

Some Republicans have suggested a partial expansion limited to low-income adults who are mentally ill, have substance abuse problems or other health issues that could affect far fewer Virginians.

Supporters of full Medicaid expansion argue that the public health costs could be significant, with widespread improvements in treatments for asthma, heart disease, opioid addiction and other conditions.

Medicaid expansion could also be a boost for the state’s economy, bringing in about $2 billion a year in federal funds. The federal government pays at least 90 percent of the costs of the Medicaid expansion population, as opposed to 50 percent in the existing program.

But opponents say that even with the federal government paying the lion’s share, the long-term costs of expanding Medicaid could still be disastrous because of rising health care costs.

Early clues

The first real clues about Medicaid expansion’s future could come when both chambers release their proposed state budgets Sunday.

Former Gov. Terry McAuliffe included Medicaid expansion in the budget he proposed last year before leaving office, giving the state an extra $422 million in the next two years assuming an Oct. 1 start date. That budget also includes a new a tax on hospitals called a provider tax, designed to help defray the state’s costs of expanding Medicaid.

Senate Majority Leader Tommy Norment said recently that lawmakers working on the budget are still wrestling with what to do with that Medicaid expansion related-money.

“The focus has been on Medicaid, and I would say it’s almost paralyzing budget discussions,” Norment said.

Possible sticking points

There are several possible sticking points in a potential compromise, like whether to mandate monthly premiums and co-pays for some new Medicaid recipients.

Cox and the Northam administration have already clashed over the cost and feasibility of imposing work requirements on some Medicaid recipients in Virginia.

“If your position is to pass straightforward Medicaid expansion without work requirements or other reforms, then you will be responsible for the failure to provide healthcare coverage to more Virginians,” Cox said in a letter to Northam last month.

On Monday, the House advanced a GOP-sponsored work requirements bill with little discussion, a sign of some kind of detente.

The Trump administration’s recent announcement that it will approve state proposals requiring “able-bodied adults” to work, study or perform some kind of service could provide Republicans with cover to support Medicaid expansion after years of opposition. Conservative lawmakers in other states that have rejected Medicaid expansion have started resurrecting plans for increasing coverage after that announcement.