Column: State Budget Advances on Medicaid

Column: State Budget Advances on Medicaid

Last week, I wrote about the transportation legislation that passed the General Assembly. The other major policy change this session was the expansion of Medicaid. This was especially critical for the 44th District.

Medicaid is a federal-state health insurance program for low-income and disabled people. It is also the only provider of long-term nursing care for many Americans, since Medicare coverage and coverage by most private insurance policies is quite limited. Virginia has one of the most restrictive Medicaid programs in the United States — you have to be very poor to be eligible. Most rankings put Virginia at 48th in Medicaid expenditures and 7th in per capita income. In other words, we are a relatively wealthy state and we do not help the poor much.

The 44th District has the largest uninsured population and the largest Medicaid population in Fairfax County. Over 9,000 children in our community receive their healthcare from Medicaid. That is equal to one in three children in the 44th District and 15 percent of all residents of the 44th District. Approximately 70 percent of uninsured Virginians are employed and only 37 percent of small businesses (less than 50 employees) provide employee health insurance benefits. Approximately, 5.6 percent of the uninsured or 56,000 people are Virginia veterans and their family members.

Virginia already spends millions indirectly on uninsured care including about $100 million per year subsidizing uninsured care at state hospitals, $515 million per year in charity care at hospitals, and about $300 million per year is provided at free clinics and through charities. Most analyses conclude that about 10 percent of private health insurance cost is for uninsured individuals.

The Patient Protection and Affordable Care Act (aka Obamacare) allowed each state to expand Medicaid with the federal government picking up between 90-100 percent of the cost over an eight-year period. The actual cost to Virginia taxpayers is largely neutral due to the elimination of uninsured care, charity care, reduced demand for free clinics, and uninsured care paid by private insurance.

The analyses prepared by Senate Finance staff also found that the Virginia Medicaid expansion would create 33,000 Virginia jobs. Coverage for preventative care would also reduce overall system expenditures as people will get help before they become too sick.

Most states have agreed to expand Medicaid after analyzing the consequences and rather than seeing their federal tax dollars go to other states. Recently, even Republican Governors Christie (N.J.), Kasich (Ohio), and Rick Scott (Fla.) have moved forward. At the beginning of the session, Governor McDonnell opposed expansion. In the last few days of session, he moderated his position, but a large contingent of downstate legislators continued to oppose the expansion.

The compromise struck on the last day created a panel of 10 Virginia legislators who are tasked with certifying that the federal government has agreed to certain reforms — mainly the implementation of managed care in the provision of services compensated by Medicaid. Upon the panel’s certification, the Governor would be required to proceed with expansion.

Attorney General Cuccinelli issued an opinion that this system is unconstitutional, but he issued the opinion without reading the actual bill. This issue will be litigated.

I voted for the final state budget largely due to the inclusion of this language in the final amendments. I am hopeful that it will be sustained because it is absolutely critical to getting our health insurance costs under control and providing economic security to the working poor and other families in the 44th District.

Next week, I will provide a third update on other measures in the state budget and other legislation that passed this session.

It is an honor to serve as your state delegate.