Groups push for Medicaid expansion

Gov. Terry Branstad calls plan 'unaffordable and unsustainable'

James Q. Lynch
Published: January 30 2013 | 5:30 am - Updated: 28 March 2014 | 10:43 am in
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DES MOINES – Nearly 50 interest groups gathered at the Capitol Monday to make fiscal, health and moral arguments for the expansion of Medicaid coverage to as many as 150,000 Iowans.

Broadening the eligibility requirements would be a “win-win if not a win-win-win” for state government, low-income Iowans and the Iowa business community, Kirk Norris of the Iowa Hospital Association said at the Statehouse. The hospital industry, he noted, is a major employer and has a $6 billion impact on the state’s economy.

The loose coalition that included AARP, the American Cancer Society and Iowa Catholic Conference, has support of Democratic lawmakers. Sen. Jack Hatch, D-Des Moines, and Rep. Lisa Heddens, D-Ames introduced legislation Tuesday that would make more Iowans eligible for the program that provides health benefits for about 400,000 Iowans.

Their plan would raise the Medicaid eligibility limit to 138 percent of the federal poverty level, or about $15,400 annually for an individual.

However, Republican Gov. Terry Branstad has called the expansion “unaffordable and unsustainable.” He also points out the state is picking up $57 million in additional Medicaid costs this year because of decisions at the federal level.

As part of the federal Affordable Care Act, the federal government would pick up 100 percent of the additional cost for three years and then a declining share of the cost after that.

Given the federal government’s debt situation, Branstad questions whether it can meet its commitment.

The hospital industry wants the expansion because it made a “bad deal” with the Obama administration to support health care reform, Branstad said. The hospital industry agreed to a reduction in Medicare reimbursement in exchange for Medicaid expansion, he said.

“I understand why they want to shift that burden to us,” he said on Iowa Public Radio on Monday. “I understand they are getting killed by the federal government on their Medicare reimbursement.

“They need to go to Washington and get this thing solved in Washington D.C., not on the backs of the Iowa taxpayers,” Branstad said.

Norris rejected that.

“Deal-making implies an arm’s length transaction. There was none,” Norris said.

Instead, the reduction in Medicare reimbursement to Iowa was based on a projection there would be a $160 billion windfall from expanding health insurance coverage to 30 million more Americans, Norris said.

“So hospitals contributed toward the payment of health care reform,” he said.

Historically, Iowa’s Medicare reimbursement rate has been among the lowest among the states.

“If we do not accept the opportunity to take back what Iowa has contributed, which is $2.3 billion over 10 years, we further exacerbate this whole equity scenario between states as it related to Medicare and now as it relates to Medicaid,” Norris said.

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