MONTGOMERY — Alabama leaders have time to reconsider last week’s decisions not to expand Medicaid or create state-run insurance exchanges under the federal Affordable Care Act.
In fact, Alabama could do either in 2013 or later.
Advocates for low-income Alabamians and some medical professionals hope for sooner, rather than later - or not at all. Not expanding Medicaid will leave thousands of working people without the coverage touted in the act.
Meanwhile, some Republican lawmakers say the state needs to focus on reining in Medicaid spending — $603 million this year — and not making it more expensive.
Gov. Robert Bentley last week said the exchange — a virtual marketplace where uninsured individuals and small businesses can shop for health care coverage — and the expansion to cover nearly 300,000 Alabamians would be too costly to the state. He has called the act the worst piece of legislation he has seen in his lifetime.
Separate from the expansion discussion, at least two state-level committees are studying how to better control current Medicaid costs. Medicaid is the state’s largest noneducation appropriation.
Jim Carnes has attended many of those recent committee meetings and hopes restructuring Medicaid will lead to expansion.
“We are encouraged the governor left the door open on the Medicaid expansion because he said we would not expand under current structure,” said Carnes, communications director for Alabama Arise, a non-profit supporting policies that improve the lives of low-income Alabamians.
Carnes said Arise agrees the Medicaid reform process is critical.
“The challenge is going to be balancing the reform process and seizing the expansion opportunity to take full advantage of it,” he said.
The federal government, starting in 2014, will pay 100 percent of expansion costs for three years. After that, states would take on about 10 percent of the costs. Still, state officials say that will add up to hundreds of millions of dollars by the end of the decade.
States were supposed to let the federal government know by Friday if they would create their own exchanges, or rely on federal implementation. On Thursday, that deadline was extended a month, but a spokeswoman for Bentley said that announcement didn’t change Bentley’s decision.
But even if they pass this year, states can jump into the process next year or in 2014.
Transforming and expanding Medicaid would be a huge endeavor, Carnes said. But it would also have a major impact across the state by providing medical coverage to working adults.
“Most of them are working folks in low-wage jobs,” Carnes said. “They earn too much to qualify for our current, extremely low Medicaid, but they can’t afford private insurance.”
If Alabama adopts the Medicaid expansion included in the Affordable Care Act, all people making 133 percent of the poverty level would be eligible. For individuals, those making under $14,856 per year would be eligible. The eligibility cap for a family of four would be $30,657.
A recent University of Alabama at Birmingham study said almost 309,000 Alabamians meet the expanded Medicaid criteria under ACA. It estimated the number of new adult Medicaid enrollees would range from 246,219 to 301,799.
The same study said if the state didn’t expand Medicaid, some of those would be eligible to buy insurance in the exchange, but about 228,000 likely will be left without health coverage.
Proponents have said the expansion would be a boost for the state’s workforce.
“If they get into a stable system of health care, they are going to be more consistent and reliable in their workplace,” Carnes said.
And if Alabama never expands Medicaid?
“You will have this range of folks right around poverty level and below who have nowhere to turn,” Carnes said. “They’re in the cold now, but we will have a new system that wraps around them, but leaves them out.”
Meanwhile, the burden of their care is still there.
“We are all already paying for health care of the uninsured through higher insurance premiums and higher costs at our hospitals, which by federal law cannot turn away a patient based on ability to pay,” said Dr. Grant Allen, a Florence pediatrician and president of the Alabama chapter of the American Academy of Pediatrics.
State Rep. Lynn Greer, R-Rogersville, said Friday that he agrees with the governor’s decisions, but he wouldn’t rule out an expansion one day. First, he said, states need to have more control of Medicaid implementation.
“Right now, (the federal government) just says, ‘Put your money in and don’t ask any question,” Greer said. “If they would let Alabama and other states handle some of the variables it would be a much better system.”
The state Medicaid agency has no leeway over the number of people it enrolls and is not allowed to change federal rules regarding co-pays. It can’t cut eligibility requirements or services for children. But it can cut reimbursement rates.
Allen said the Medicaid expansion is an economic opportunity.
“While the Medicaid expansion will cost real state dollars, and the state is not committed to funding Medicaid at its current needs, there is no economic stimulus greater than pumping health care dollars into our states rural counties and urban centers,” he said. “Alabama spends hundreds of millions of dollars in tax incentives for industries that benefit at most a few counties. Medicaid expansion would benefit every county in Alabama and cost far less than industrial tax incentives.”