Medicaid Expansion: Size Won't Be the Only Change

It's deal time for Medicaid, and the political horse-trading could end up reshaping the health insurance program for low-income Americans.

The Obama administration wants states to expand Medicaid to cover millions more low-income adults under the health care law. A Supreme Court ruling left the decision to participate up to each state. And some of them, especially those run by Republicans, have been leery of taking more people into a program that is already one of the fastest-growing items in their state budgets.

States often ask the federal government for permission to change their programs - the way it delivers services (private managed care, for example), limits enrollment (a lower poverty level for certain enrollees) or is financed (premiums and out-of-pocket expenses). Critics complain that such "waivers" can weaken the guarantee that all Medicaid beneficiaries across the nation get a minimum levels of service.

But the states aren't being shy now.

"There's a lot of 'let's make a deal' going on and a willingness to try new things," Robert Laszewski, the president of Health Policy and Strategy Associates, told Sarah Kliff of the Washington Post.

Kliff says the impact could be "a larger, but more conservative, Medicaid program."

One of the fiercest critics of Medicaid expansion, Republican Gov. Rick Scott of Florida, recently reversed course and asked the state legislature to authorize expansion on the same day he won a federal waiver to move most of the state's Medicaid program into private managed care.

In Virginia, Gov. Bob McDonnell has waved legislators off expansion unless the state gets waivers for private management and more cost-sharing for some beneficiaries.

But the requests aren't limited to Republican governors. Democratic Gov. Jerry Brown of California secured permission to shave payments to Medicaid service providers by 10 percent. Opponents of the cuts went to court.

Robert Pear reported in the New York Times that "[t]he Obama administration urged [appeals court] judges to uphold those cuts, which are being challenged by patients, doctors, dentists, hospitals, pharmacists and other health care providers in California.

"AARP ... joined the [National Health Law Program] and more than a dozen consumer groups in opposing the cuts, which they said would reduce access to care for millions of current and future beneficiaries.''