Several Republican governors have embraced a key pillar of President Obama’s health-care law and agreed to a major expansion of Medicaid, representing a significant retreat from their party’s earlier, widespread opposition.
Many Republicans balked at the prospect of growing the already costly Medicaid entitlement program when the Supreme Court made that part of the health-care law optional for states in a ruling last June. Supporters of the law worried that the opposition, driven by Republican governors, could undermine the entire health-care overhaul by shrinking the pool of Americans who would gain coverage.
But six Republican governors have announced they are planning to join the program, including Michigan’s Rick Snyder on Wednesday and Ohio’s John Kasich on Monday. Jan Brewer of Arizona announced her support in mid-January.
This extraordinary turnaround suggests that the lure of federal dollars could halt Republican obstruction of the health-care overhaul. Twenty-two states and the District are now on board, and 17 others are deliberating. The remaining 11, all with Republican governors, have said no — but observers believe the recent decisions could change some minds.
“It’s a tipping point,” Bill Pierce, a former Health and Human Services official under President George W. Bush, said. “You’ve now got a real conservative state, a battleground state and a blue state all signed up. If you’re a Republican governor thinking about this, you fit into one of those categories.”
The Medicaid expansion is a critical piece of the Affordable Care Act, Obama’s signature policy accomplishment. Half of the 30 million Americans expected to gain health insurance will do so by moving onto Medicaid, beginning Jan. 1.
Since the court’s decision, hospitals and other health-care providers have lobbied governors aggressively to agree to expand their Medicaid programs. The providers had accepted billions of dollars in cuts to health-care reimbursements because they thought they would gain millions of newly insured patients through Medicaid.
They have teamed up with local chambers of commerce and small businesses to argue that states could net a windfall of federal dollars with little investment of their own, because the law guaranteed that virtually all of the newcomers to Medicaid would be covered with federal money.
Governors have become increasingly worried about getting their fair share: If they do not extend Medicaid, their federal tax dollars will still foot the bill for expansions in other states. The Obama administration has also gone out of its way to reassure governors that upcoming budget reductions will not derail the program.
“Medicaid cuts for this president are not on the table,” White House senior economic adviser Gene Sperling told a conference of health advocates last week.
Any health law program remains a tough sell among conservatives and could endanger governors seeking reelection as soon as next year. Most Republican governors, including Brewer and Kasich, have refused to set up health insurance marketplaces, another part of the ACA meant to extend coverage to the uninsured. But because of their positions on Medicaid, the Wall Street Journal’s editorial board recently described those two governors as “Obamacare Flippers” who accepted “Mr. Obama’s Medicaid bribe.”
“This is going to be a serious problem for them if they want to seek higher office,” said Michael Cannon, the health policy director at the libertarian Cato Institute. “It doesn’t matter if they say ‘I don’t consider this Obamacare.’ Their base does, and their base really dislikes this law.”
The Medicaid expansion will cover Americans below 133 percent of the federal poverty line — $11,170 for an individual — in 2014. Currently, many of these people have no coverage at all. If all states were to participate in the Medicaid expansion, the Congressional Budget Office estimates an additional 17 million Americans would be covered by 2022.
If a state does not expand Medicaid, residents with incomes above the poverty line could access federal subsidies to purchase a private health plan. Those who earn less would not have access to the health coverage expansion.
“The logjam has broken,” said Ron Pollack, executive director of Families USA, a health advocacy group that supports the law. “When you have a governor like Kasich getting to yes, you have a critical mass.”
Pollack’s group will soon launch a $1 million campaign targeting about a dozen states still on the fence about the Medicaid provision. Families USA will also release data on the economic effect it would have in each state, detailing the additional health-care jobs it could generate.
“The business standpoint will be compelling to Republican governors who are otherwise critical of the law,” Pollack said.