The spread of the new coronavirus, the resulting strain on hospitals and the possible infusion of federal relief money is rekindling talks of expanding the state’s Medicaid program
For 10 years Alabama has resisted expanding its Medicaid program under the Affordable Care Act, mostly on fiscal grounds. Some estimates show expanding the program to include 360,000 more residents would cost the state about $170 million in the first year alone, with increasing costs going forward.
However, now the state could be in receipt of funds to lighten that bill. The coronavirus economic relief package known as the CARES Act contained $150 billion to help states and local governments recover from the financial impact of the outbreak and specifically included provisions to help states shore up their Medicaid programs. Analysis from the Center on Budget and Policy Priorities shows Alabama coffers could receive as much as $1.7 billion, though much of that is likely to be earmarked toward specific programs.
U.S. Sen. Doug Jones, a Democrat, wants the state of Alabama to use these incoming resources to expand Medicaid coverage to more low- and middle-income families. During an online press conference last week, Jones urged state leaders to act.
“Go ahead and expand Medicaid now. We’ve got additional monies coming in,” Jones said. “I really think (the Centers for Medicaid and Medicare) would work with us to implement this quickly and get people covered.”
One problem facing states such as Alabama that did not expand Medicaid in the early days of Obamacare is that, should they expand now, they no longer would enjoy the 100% federal funding match once offered to states. Jones wants to turn back the clock on that incentive and offer states the full benefit of expanding Medicaid. His legislation, the States Achieve Medicaid Expansion (SAME) Act, would provide states that choose to expand Medicaid now the same level of federal matching funds as states that expanded earlier under the terms of the Affordable Care Act.
Jones was unsuccessful at adding his bill language to the CARES Act, but he said he’s working to get it inserted into a potential “Phase 4” coronavirus relief bill being discussed on Capitol Hill. Congresswoman Terri Sewell has introduced similar legislation in the House and also wants it inserted in the next bill, her office said in a press release last week.
“I’m hoping that’ll happen,” Jones said. “We wanted to get our SAME Act into this past legislation, and we are still going to push that.
“… But I think there are incentives beyond funding. I think this pandemic has shown why we need this, as unhealthy a state as we are and a relatively poor state.”
Jones’s office said the senator had not spoken to Gov. Kay Ivey about specific plans to provide Medicaid expansion incentives. Ivey’s office said that, while “all options are on the table,” the governor remains realistic about the fiscal challenges that expansion poses for the state.
“…[T]o expand Medicaid, there must be a stable source of revenue for the required state match, whether that be now or three years from now,” spokeswoman Gina Maiola said. “(Ivey) is well aware of the needs within our system, but to say we must expand Medicaid without the honest discussion of how we can pay for it is irresponsible.
“Her immediate concern and No. 1 priority right now is protecting the people of Alabama from the further spread of COVID-19,” Maiola said.
While the governor has the authority to begin the process of expanding Medicaid at the programmatic level, only the Alabama Legislature can allocate funding to pay for it.
Senate President Pro Tem. Del Marsh, R-Anniston, said that so far, he’s “not seen anything on a Medicaid expansion plan that I’d sign off on.”
He said most in the Republican Party aren’t for further expanding the government program.
“Right now, if you were to ask me if there is an appetite for Medicaid expansion in the Senate among Republicans, my answer would be no.”
Senate Minority Leader Bobby Singleton, D-Greensboro, has long pushed for Medicaid expansion, but said new funding from the federal government and a branding change might be the only way to convince Republicans who control the Legislature.
“We have been little-by-little putting together legislation that I call ‘back door’ expansions,” he said. “But at the end of the day, it’s getting paid for by us, the state. So, I think if federal dollars were to come down now, that gives them a way to do it without having to pay any of those dollars back.
“People may not want to call it Medicaid expansion, but I think they would make adjustments to what those federal dollars would allow us to do in order to do it.”
Senate General Fund budget committee chairman Greg Albritton, R-Range, said Alabama can’t control many cost factors related to Medicaid, including what treatments or medications are covered or who is added or removed from the rolls. While the federal government pays the lion’s share of Medicaid costs, that amount, called the federal medical assistance percentage, or FMAP, varies annually.
“It is hard to take on more of an obligation when you can’t control the obligations you already have,” Albritton said Thursday. “There are several instances in my mind we need to gain control of before we reach out for further obligations.”
Without expansion, the state’s General Fund obligation for Medicaid, which serves about 1 million low-income or disabled Alabamians, has increased steadily in the last decade, from about $307 million in fiscal 2009 to $725 million this year.
“I don’t see how we can (expand), it’s not a matter of not wanting to,” Albritton said. “I just don’t see a path with all the unknowns there.”
Advocates argue that within a few years of expansion, related economic activity would generate hundreds of millions of dollars in state tax revenues.
In the House, General Fund budget committee chairman Steve Clouse, R-Ozark, has been more receptive to Medicaid expansion conversations of late. He said he’s not aware of any such talk among leadership lately.
But if states were offered again the original proposal — three years of expansion at no cost to them — Alabama officials should consider it, he said.
“I think we would seriously have to look at it at that point,” he said.
While Clouse is concerned about the coronavirus’ impact on Alabamians and health care, he’s also watching other numbers.
“I’m concerned about the unemployment rate shooting up and Medicaid rolls shooting up because of it,” he said.
House Minority Leader Rep. Anthony Daniels, D-Huntsville, said another factor playing into any expansion decision is the ongoing coronavirus outbreak and the resulting strain on Alabama’s health care infrastructure.
“Some of the things we’re beginning to see is that we’re being exposed because of our health disparities,” he said. “Our health care infrastructure is struggling. The hospitals that are online right now are doing a wonderful job responding to this crisis, but we’re also putting an additional burden on those hospitals because people who are uninsured, those hospitals still have to see and test them.”
While the CARES Act bill provided funding to cover COVID-19 testing costs for hospitals, it did not extend funding to cover treatment costs, leaving hospitals to potentially foot the bill for those expenses if patients are uninsured. Seventeen Alabama hospitals have closed in the past decade and only one has reopened, The Associated Press reported last month.
Now, hospitals around the state are in the middle of an unprecedented challenge amid the coronavirus pandemic, Alabama Hospital Association Executive Vice-President Danne Howard said. Hospitals have long supported Medicaid expansion, but their main focus at the moment is getting through the crisis.
“We remain committed to and support providing health insurance to more Alabamians,” Howard said. “The COVID-19 outbreak reinforces just how important it is for families to have health care coverage.
“Hospitals in Alabama will continue to provide care regardless of a patient’s ability to pay, 24 hours a day and seven days a week.”
Alabama Daily News reporters Mary Sell and Caroline Beck contributed to this report.