The Senate finally found a way to agree on how to expand Medicaid services for up to 20,000 mentally ill, addicted, disabled and chronically ill Virginians, but without a way to pay for them.

The chamber voted unanimously Tuesday to approve Senate Bill 915, proposed by Sen. Siobhan Dunnavant, R-Henrico, which would expand Medicaid eligibility for people earning up to 138 percent of the federal poverty level — $16,753 a year for a single person — if they suffer from serious mental health or substance disorders or chronic diseases.

It also requires the funding of 2,300 waiver slots for people with intellectual or developmental disabilities, orders creation of a new set of services for people with brain injuries, and would fund private transportation of mentally ill people under temporary detention orders to relieve the burden on law enforcement.

But the dramatically revised bill wouldn’t take effect unless the two-year budget ultimately approved by the General Assembly includes money to pay for it.

“Let me be clear: While we have consensus on the needs of these populations, we do not have consensus on how to pay for it,” Dunnavant said.

Dunnavant, an obstetrician, cleared the way for Democrats to support her bill by dropping a proposed tax on inpatient hospital patient revenues as a way to pay the state’s share of costs that would be split evenly with the federal government as an alternative to accepting federal money to fully expand Medicaid to hundreds of thousands of uninsured Virginians, most of them childless adults.

The vote ends the first act in a long drama that will continue Sunday, when the Senate Finance and House Appropriations committees adopt their versions of a two-year budget that, as introduced in December by then-Gov. Terry McAuliffe, would expand Medicaid to accept $3.2 billion in federal funds under the Affordable Care Act.

The governor’s proposed budget, strongly supported by his successor, Gov. Ralph Northam, would pay the state’s share with a hospital tax similar to the one that Dunnavant dropped from her proposal and generate an estimated $421.7 million in savings over the biennium. That would pay for a wish list that includes state employee raises, expanded mental health and substance use treatment, and a fattened cash reserve to allay a bond-rating agency’s concerns about the state’s fiscal outlook.

“This bill certainly sets up that we could have that conversation in the budget,” said Sen. Steve Newman, R-Lynchburg, who had helped shepherd Dunnavant’s bill through the Education and Health Committee and Finance Committee in the face of opposition by Democrats who called the measure a poor substitute for expanding Medicaid.

Work requirement

On the other side of the Capitol, the House of Delegates adopted a bill Tuesday that would seek federal approval of a work requirement for Medicaid recipients as a condition set by House Republicans for considering Medicaid expansion after more than four years of blocking it at every turn.

Thirteen Democrats voted with 51 Republicans to approve House Bill 338, proposed by Del. Jason Miyares, R-Virginia Beach, and rewritten by the House leadership. The bill seeks to create a requirement of work or public service for Medicaid recipients, although it would apply to only about 6,200 caretaker parents with extremely low incomes unless Virginia expands eligibility to childless adults.

It passed the House Appropriations Committee last week unanimously and the full House by a 64-36 vote Tuesday.

Senate Democrats also cheered Dunnavant’s bill after she dropped a proposed “provider assessment” that would have raised about $370 million in the biennium — compared with about $307 million under the governor’s proposed budget — and a provision that would have boosted state reimbursement rates for hospitals from 71 to 83 percent of their costs.

But while Democrats embraced the services that her legislation would provide, they urged Republicans to pay for them by expanding Medicaid and accepting federal funding of no less than 90 percent of the costs.

“I don’t want anybody to think we’re actually funding this,” said Sen. Janet Howell, D-Fairfax. “We won’t be able to fund this unless you expand Medicaid.”

Insurance policies

Medicaid wasn’t the only big, hot-button issue addressed Tuesday by the Senate, which unanimously approved another Dunnavant proposal after she dropped a requirement that insurance companies under contract to serve state Medicaid managed-care programs also offer policies in the individual markets crippled by the ongoing political battle in Washington over the future of the Affordable Care Act, also called Obamacare.

Instead, the Senate approved Senate Bill 844, after it was reduced to a proposal added by Sen. Bryce Reeves, R-Spotsylvania, that would allow Virginians to buy stripped-down insurance policies of up to 364 days if the federal government allows their extension beyond the current three-month limit.

The Senate also sought to address public concerns about individual health insurance and triple-digit premium increases by unanimously adopting Senate Bill 964, proposed by Sen. Glen Sturtevant, R-Richmond, to seek a federal waiver that would allow all Virginians to buy low-cost, high-deductible “catastrophic” health plans, not just people under 30.

COPN bills

The most hard-fought health care issue on the Senate floor centered on two bills that would create new exemptions from the state’s certificate of public need, or COPN, requirements to regulate the entry of providers in specialized medical markets that often are more profitable than general hospital care.

The COPN program requires anyone who wishes to build a new hospital or imaging facility go through an application process with the state.

Senate Bill 266, originally proposed by Sen. David Suetterlein, R-Roanoke County, to allow creation of a neonatal unit at a Roanoke Valley hospital that had been stymied by the COPN process, came to the floor with six other bills included that also would carve out exemptions for specific medical operations in different parts of the state.

“This has become a Christmas tree bill,” complained Sen. John Edwards, D-Roanoke, who had supported Suetterlein’s original bill but voted against the omnibus legislation.

“I doubt we can reform COPN until we expand Medicaid,” Edwards said, referring to hospitals’ concerns that unregulated competition would drain their revenues from profitable services while leaving them with obligations to provide general care that loses money.

One of the bills incorporated into the legislation was Senate Bill 354, proposed by Sen. Jennifer McClellan, D-Richmond, to exempt an ophthalmic surgery center in Ashland. “Whether this bill passes or not, we are going to have to address COPN reform,” McClellan said.

The Senate passed the bill on a 20-19 vote, with Sen. Bill Stanley, R-Franklin County, stepping out of the chamber during the vote.

Stanley also stepped out for the vote on Senate Bill 757, proposed by Sturtevant to exempt psychiatric hospitals and other facilities for mental health or substance use treatment from the COPN process. The Senate killed the bill on a 17-22 vote.

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Senate votes to expand some Medicaid services with no way to pay for them