Virginia Medicaid Debate Uncertain

The battle lines remain largely fixed in the evolving Medicaid debate in Virginia.

Both sides still are coming to terms with the potential outcomes of the decision on whether to expand the state and federally funded program providing health care for people with low incomes. It could be years before the issue is resolved, said Del. R. Steven Landes, R-Weyers Cave, the vice chairman of a state panel exploring the topic.

“We can decide whenever,” Landes said last week in the Glenmore Country Club ballroom, where he spoke on the subject at an Albemarle-Charlottesville Republican Women's League luncheon. “But we need to decide probably within the next, at least, two years whether we're going to do it.”

Medicaid expansion immediately could cover an estimated 400,000 Virginians if the commission acted now, officials said. State hospitals stand to lose tens of millions of dollars a year if the program isn't expanded, top officials said.

At the University of Virginia Medical Center, for example, the losses could reach $40 million annually, CEO R. Edward Howell said earlier this month.

“The people that need care and aren't insured will remain,” Howell said. “It really puts us in a pretty challenging position.”

Landes, who has been an expansion foe, said he understands the pressure hospitals face.

“It's a very difficult issue from the standpoint of places like UVa that are dealing with it,” Landes said. “But it's also a state concern.”

Under the provisions of the federal Affordable Care Act, states can open their Medicaid programs to people with incomes up to 138 percent of the federal poverty level, about $32,000 for a family of four. The federal government has promised to pick up the tab for the first three years of the expansion, with that share gradually declining to 90 percent.

Gov.-elect Terry McAuliffe contends expansion would pump about $2 billion a year into the state economy.

“The governor-elect is strongly in favor of taking the federal money to expand Medicaid,” McAuliffe spokesman Brian Coy said. “He believes that not only is it the right thing to do, but it will bring Virginia tax dollars back to Virginia to cover 400,000 uninsured and create 33,000 jobs.”

Landes said there's no guarantee a financially strapped federal government can pay the cost of new Medicaid enrollees.

“As they're dealing with the federal deficit, as they're dealing with the debt limit at the federal level, a lot of us are not confident the funds are going to be there long-term,” Landes said.

Split over the issue, the General Assembly struck a compromise earlier this year, creating a panel empowered to expand Medicaid, but only if Washington agreed to let the state reform the way the program operates in the commonwealth.

Even if the federal government stays true to its word, the state still would be on the hook for more than it can afford, Landes said.

“If the federal government were to meet their obligation, there's over a half a billion-dollar commitment, over $500 million, the state would have to come up with,” Landes said. “The concern now is our economy is not really expected to grow at the levels that could even cover that cost.”

Landes said if the state has to make up for the federal government's shortfall, it might have to cut elsewhere, such as in public education and public safety.

“Or we have to look at raising taxes,” he said.

Landes' language has softened in recent months.

In October, the delegate sent a confidential memo to fellow House Republicans detailing a worst-case scenario in which the federal government only reimburses the state for half the cost of Medicaid expansion.

Doing so, Landes said, would leave the state on the hook for more than $1 billion a year.

“The national debt is nearly $17 trillion,” Landes wrote. “Eventually, the federal government is going to have to address its spending problems. When it does, Virginia taxpayers will almost certainly get stuck with the bill for Medicaid expansion.”

Following McAuliffe's Nov. 5 gubernatorial victory, Landes told The Huffington Post that the election changed nothing in terms of Medicaid expansion in Virginia.

“Mr. McAuliffe obviously doesn't have a clear mandate,” Landes said, adding that he thought House candidates who were running in statewide elections received “about 25,000 more votes than [McAuliffe] did.”

Landes' tone last week was more reserved.

“I've just got some concerns,” he said.

State House Minority Leader David J. Toscano, D-Charlottesville, said some expansion opponents' concerns are hinged more on reputation than actual fear about fiscal fallout.

“I think a lot of people don't want to have anything to do with the federal health care bill,” Toscano said. “It's a hard sell in the General Assembly.”

Toscano, who favors expansion, said many state lawmakers are worried their names will be forever tied to the president's signature health care legislation if they choose to expand Medicaid.

The long-term financial implications at hospitals and in communities warrant notice, he said.

“If you look at areas which have large hospitals, like the University of Virginia, they will be dramatically impacted by a failure to expand Medicaid,” Toscano said, “both in terms of the quality of care and the jobs that are provided by the hospital themselves.”

“I don't think people should ignore that,” he said, “or they do so at their peril.”

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