January 27

State House Notebook: The politics of expanding Medicaid

Also: Conservative Web forum gets new owner, new life.

By Steve Mistler smistler@pressherald.com
Staff Writer

The Legislature’s Health and Human Services Committee last week postponed a vote on a contentious Medicaid expansion bill. It’s not clear when the committee will reschedule the vote, but the delay shouldn’t be a surprise.

Democrats have made expanding the publicly funded health insurance program, which the state calls MaineCare, a legislative priority since winning the majority in 2013. However, with the exception of a few Republicans and traditionally aligned interest groups, Democrats’ quest to expand Medicaid through the federal health care law has been a one-sided effort.

That seems to be changing.

There’s some speculation – and that’s all it is – that more Republican lawmakers are supportive of a bipartisan compromise plan that could solidify a veto-proof majority. Also, other interest groups, including the Maine State Chamber of Commerce, are involved in the discussion. If the Chamber can support an expansion bill, that could help Democrats pull in more Republicans.

There are signals that the broadening coalition is gathering some momentum. Gov. Paul LePage said recently that he expects Medicaid expansion will pass the Legislature. Nonetheless, there will still be a lot of pressure on Republicans to reject expansion, just as there was last year. Even if Democrats can bring along enough Republicans for the early votes in the House and Senate, holding them will be difficult.

That’s why you’re not hearing many actual names of Republican supporters. The longer they’re out there as “yes” expansion votes, the longer they’ll be lobbied by ardent opponents to reject it. It’s not an easy thing to support something most of your party opposes.

Also, the conventional wisdom has been that swing-district Republicans are the likely “yes” votes. But the swing-district theory doesn’t tell the whole story. There are rural Republicans in solidly conservative districts who may be feeling pressure from their constituents – or the local hospital – to back expansion.

The Maine Hospital Association will play a key role. Hospitals and the MHA seem to be more vocal about supporting expansion this year than they were last year.

That’s important because hospitals have a lot of influence in the State House, and in legislatures across the country. In some states, hospital support has tipped the balance in several expansion debates. That’s because hospitals are major employers and they have deep roots in their respective communities.

That influence is why LePage’s bill to repay Maine’s hospitals $183 million in backlogged Medicaid payments was so successful and politically effective last year.

It could be that Republicans with hospitals in or near their districts will feel the same pressure to vote for Medicaid expansion that Democrats felt to approve the debt payback revenue bond last year.

The hospitals have a financial stake in Medicaid expansion, but so do businesses.

Last week the AARP, an expansion supporter, circulated a report by the Jackson Hewitt Tax Service that said states that don’t expand Medicaid for adults could leave large employers exposed to so-called “shared responsibility” tax penalties in the Affordable Care Act. Under the law, employers that provide health insurance and have 50 or more full-time employees must pay up to $3,000 in tax penalties for each employee who applies for insurance assistance. According to the study, employers in the 25 states that don’t expand Medicaid will pay between $1.03 billion and $1.55 billion in penalties each year. The penalty estimate for large Maine employers is between $3 million and $4 million.

With that scenario looming, it’s no wonder that the Maine State Chamber of Commerce, which represents large and small businesses, is interested in a Medicaid expansion compromise.


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