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State’s budget director “optimstic” Medicaid expansion is coming

Republican Gov. John Kasich’s budget chief told Dayton business leaders on Tuesday he is “optimistic” a proposal to expand health coverage to an estimated 275,000 working poor Ohioans will reemerge by the end of the year.

Ohio Office of Budget and Management Director Tim Keen restated arguments for expanding Medicaid eligibility, a centerpiece of the governor’s budget proposal that House Republicans nixed earlier this year. He spoke at an event Tuesday in downtown Columbus organized by the Dayton Area Chamber of Commerce.

Under Democratic President Barack Obama’s Affordable Care Act, the federal government would foot the bill for Medicaid expansion for the first three years, and then pick up 90 percent of the cost in future years, worth an estimated $13 billion during the next seven years.

Keen said he remains “optimistic” that a Medicaid expansion proposal will emerge sometime this year — either as part of the budget or as a standalone bill. It’s believed an eventual plan could involve using the federal money to purchase private insurance, a move that would require federal approval.

Keen addressed an officially friendly crowd on the issue: the Dayton Chamber supports Medicaid expansion, as long as there’s an opt-out provision if the federal government changes its end of the deal.

Keen acknowledged House Republicans’ and others’ concerns about accepting federal money. But he said not expanding Medicaid will cost the state $500 million, and will cost employers who otherwise face federal penalties for their uninsured workers.

“The ability of the state to draw $13 billion over the next seven years to Ohio in the governor’s view is good for the healthcare system, good for the hospitals and frankly, good for the economy,” Keen said.

He also went over other elements of Kasich’s budget proposal, including the governor’s plan to swap income tax cuts for an expansion of sales tax and increased taxes on the oil and gas industry. That plan also ended up on the House’s cutting room floor, thanks in part to strong opposition from chambers of commerce and other business groups across the state.

Keen said the administration is now working with the Ohio Senate on a smaller income tax cut.

Fielding a question about whether Kasich sees a path to ending the state income tax altogether, Keen said the governor’s tax plan would have helped.

“We need to be able to adopt a tax reform proposal that shifts some of the tax to consumption if we’re going to completely eliminate the income tax,” Keen said. “I think we’ve seen over the last couple of months how difficult that can be.”

In response to another question, Keen said taxing Internet sales, as passed by the U.S. Senate earlier this month, would even the playing field between traditional and Internet retailers, and would bring millions of dollars to the state government that could be used to pay for income tax cuts.

Also speaking at the event were state legislators Sen. Chris Widener and Rep. Ross McGregor, both Springfield Republicans.

Former Republican Gov. Bob Taft, now a political science professor at the University of Dayton, also briefly spoke, introducing Keen.

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