Dayton will be at the center of the debate over expanding Medicaid in Ohio today as members of Senate Finance Subcommittee on Medicaid gather downtown to hear final testimony in the last of a series of statewide hearings on the issue.
CareSource, the largest Medicaid managed care provider in Ohio, will host the public hearing beginning at 1 p.m. at its d0wntown headquarters at 230 N. Main St.
Representatives of the nonprofit will also testify about the merits of expanding the state-federal health care program for the poor and disabled to about 270,000 newly eligible Ohioans.
Proponents hope the subcommittee hearings will generate bipartisan support to bring Medicaid expansion back to life after statehouse Republicans blocked Gov. John Kasich’s proposal earlier this year.
“I can’t predict the timeline, but I am still extremely optimistic that we will have Medicaid expansion in Ohio, and I believe the work of the Senate subcommittee is paramount to not only driving expansion but…reforming the Medicaid program as well,” CareSource CEO Pamela Morris told the newspaper on the eve of the hearing.
Expanding Medicaid to anyone with income up to 138 percent of the federal poverty level, or $15,856 for an individual this year, was originally proposed under the Affordable Care Act passed in 2010.
But in confirming the constitutionality of President Barack Obama’s signature health care law last year, the Supreme Court ruled that each state could make their own decisions about whether to expand Medicaid.
Kasich included Medicaid expansion in his two-year state budget, calling it the right thing to do. But state legislators who oppose expansion on philosophical and budgetary grounds were successful in deleting the proposal from the budget before it took effect on July 1.
Kasich can still authorize an expansion, but funding and implementation would require the support of the state legislature. A plan would have to be submitted to the Ohio General Assembly no later than Oct. 1, and the legislature would have until the end of the year to enact legislation.
Morris acknowledged that CareSource has a vested interest in the outcome of the expansion debate, but she was quick to point out that expanding the Medicaid rolls in Ohio will also drive down health care costs for everyone seeking health coverage by reducing the cost of caring for the uninsured, otherwise known as uncompensated care.
The Ohio Hospital Association estimates its members spend more than $1 billion a year on uncompensated care for the uninsured. The government provides partial compensation in the form of Disproportionate Share Hospital, or DSH, payments to hospitals. But those payments have been reduced under the Affordable Care Act and are nowhere near the actual cost of care.
That forces hospitals to make up for the underpayments by cost-shifting and charging more to people with private insurance, Morris said.
“We’re all paying for uncompensated care,” she said. “But expanding coverage to low-income Ohioans will have a very positive impact on the overall health care cost structure that affects everyone who accesses health care.”
Opponents argue that expanding Medicaid is fiscally irresponsible, because it would siphon money from state coffers. They add that there is no guarantee the federal government would live up to its promise to fully fund expansion for the first three years before phasing down its contribution to 90 percent by 2020.
But Sen. Capri S. Cafaro, D-Hubbard, a ranking member member of the Senate subcommittee, said the cost argument simply doesn’t hold water.
Instead, Cafaro argues that expanding Medicaid could save Ohioans billions of dollars, based on an analysis of Medicaid spending by the Health Policy Institute of Ohio and Ohio State University.
“It is possible to basically reduce the cost associated with delivering care for Medicaid beneficiaries while covering more lives, even if the federal government walks away,” said Cafaro, who included the analysis in legislation she recently introduced — Senate Bill 166 — aimed at reforming and expanding Medicaid.
The analysis found that Medicaid spending in Ohio would reach $43.4 billion by 2025 without expansion if Medicaid spending continued at its current pace of about 7 percent annually. But with an expansion, and a 1 percent annual increase in Medicaid enrollment to account for population growth, spending would increase to $39.5 billion in 2025 — a nearly $4 billion savings.
But that scenario assumes the Medicaid cost trend in Ohio could be held down to about 4 percent a year, according to researchers.
“If you assume that (4 percent growth rate) then the numbers do work out,” said Greg Lawson of the Buckeye Institute for Public Policy Solutions. “But that’s a big assumption, predicated on being able to implement a variety of policies to accomplish that benchmark.
“If you’re inclined to put that kind of cap on the problem, why not do that under the existing program,” Lawson said, adding the state could use the cost savings from capping spending on the 2.3 million Ohioans already enrolled in Medicaid to pay for a Medicaid expansion on its own.
In any event, the ultimate fate of a Medicaid expansion in Ohio rests in the hands of the legislature.
“The Medicaid subcommittee does not have any authority to act,” Cafaro said. “All we can do is listen. Ultimately, the president of the Senate needs to convene the full Senate Finance Committee for us to take action. If that does not occur, then this is all talk and no action.”
COVERING BOTH SIDES
A state Senate subcommittee today will hold its last statewide hearing in Dayton on Medicaid expansion. Health care reporter Randy Tucker continues to provide insights into the pros and cons expanding coverage for the state’s poor and uninsured.