Some lawmakers worry about cost of Medicaid expansion

  • By Becky Bohrer
  • Monday, February 16, 2015 10:50pm
  • News

JUNEAU — A subcommittee hearing on Gov. Bill Walker’s proposal to expand Medicaid coverage revealed few new details Monday, with several members expressing concern about the cost and the federal government not honoring its commitment.

In states opting for expansion, the federal government is expected to fund 100 percent of coverage costs for newly eligible individuals through 2016, with the level stepping down to 90 percent by 2020. The federal match for existing Medicaid is 50 percent.

Rep. Dan Saddler, who chairs a Health and Social Services subcommittee comprised of House Finance members, asked Health Commissioner Valerie Davidson if the federal government’s ability to uphold its end of the bargain gave her pause.

Davidson said she is comfortable with Alaska moving forward with expansion. She noted that the federal contribution rate after 2016 would be similar to that of infrastructure projects, like roads or runways. The state needs to look at investing in health care as another important investment in Alaska, she said.

The state has told the federal Centers for Medicare and Medicaid Services that if the federal contribution rate falls below 90 percent, Alaska would no longer participate, she said. But Rep. Lance Pruitt, R-Anchorage, questioned if the state would truly just stop providing care to those who fell within the expansion population if that happened.

Walker has made expansion a priority, and his administration is trying to win over lawmakers concerned about the cost as the state grapples with a projected multibillion-dollar budget deficit. Medicaid, which helps provide health and long-term care to low-income Alaskans, is a driver of the state’s budget.

Davidson said she sees expansion and reforms aimed at making Medicaid more sustainable as going hand-in-hand.

Expansion would extend eligibility to adults ages 19 to 64 who earn at or below 138 percent of the federal poverty level and who are not caring for dependent children, disabled or pregnant.

A recent health department report said the state would be able to offset new costs associated with expansion by reducing or eliminating contributions to programs that provide health care to those who would be eligible for Medicaid.

Rep. Mark Neuman, R-Big Lake, said he would prefer to have Medicaid expansion in a stand-alone bill rather than as part of the budget. Last year, a proposal by then-Gov. Sean Parnell to move money from savings to help address the state’s pension obligation was broken out of the budget to address separately.

Contacted via email, Walker spokeswoman Grace Jang responded no when asked if Walker was considering a separate bill.

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