NC Senate Republicans do a 180 on Medicaid expansion and offer their own proposal

Senate Republicans, some formerly fierce opponents of Medicaid expansion, introduced their own expansion bill Wednesday that would give more than 500,000 low-income adults the chance to obtain health insurance.

The bill is packaged with other healthcare provisions that have legislative champions but have faced stiff opposition over the years, including allowing advanced practice registered nurses to work without doctors’ supervision, and changing the Certificate of Need law, under which the state determines whether a new medical facility or expensive piece of medical equipment is needed in an area.

The bill also addresses insurance payments for telehealth, which has emerged as a contentious issue as the immediate shock of the pandemic has faded.

Even as they introduced the bill, senators acknowledged it was unlikely to get through the state House in the short session. A legislative committee of House members and senators had been meeting since February to examine Medicaid expansion. That committee has suspended meetings during the legislative session, and the committee’s House co-chairman said last month he was anticipating more work when the session adjourns.

Senate leader Phil Berger, an Eden Republican, said Wednesday that the goal was to get the Medicaid expansion bill out of the Senate and to the House.

“This gives the committee, if we don’t get it passed in the short session, something else to chew on,” Berger said.

Senate Republican leaders had opposed Medicaid expansion for years. On Wednesday, some of them made a complete about-face, articulating the same points that longtime Medicaid expansion supporters have made for years.

Legislative Democrats and Democratic Gov. Roy Cooper have been longtime supporters of Medicaid expansion. At one time, a group of House Republicans worked on an expansion-like bill that Berger vowed would never get through the Senate.

That was all changed Wednesday. Berger even offered a vignette about a working single mother who could not afford health insurance as an example of a person Medicaid expansion would help.

Many of the low-income adults without health insurance have jobs, it would help more people obtain mental health care, and it would give people living in areas of the state with high incidences of life-threatening chronic diseases the chance at routine medical care.

About 2.7 million people in the state have Medicaid coverage. Most of them are children. The federal government pays more than two-thirds of Medicaid costs.

The state Medicaid program does not cover most adults who don’t have dependent children living at home. Parents with children must have extremely low incomes to qualify for Medicaid. That leaves most low-income adults in what’s called an insurance gap. They make too much to qualify for Medicaid, but too little to qualify for subsidized insurance in the marketplace set up under the Affordable Care Act.

Berger who has been vocal in his longstanding opposition to Medicaid expansion said Wednesday that he had changed his mind because circumstances have changed.

The state Medicaid program has moved from fee for service to managed care, a change Senate Republicans pushed to control expenses.

Challenges to the Affordable Care Act, in Congress and in the courts, have repeatedly failed to repeal or overturn it. “The Affordable Care Act is not going away,” Berger said.

In past years, Berger raised suspicions that the federal government would not continue to pay 90% of the cost of care for people insured under expanded Medicaid. The federal government has kept paying. The bill proposes that hospital taxes would pay for the remaining 10%.

The Biden administration has offered the 12 states that have resisted Medicaid expansion an additional financial incentive that would bring an about $1.5 billion to the state over two years.

“Medicaid expansion has now evolved to the point where it is good state fiscal policy,” Berger said.

In the Senate Health Committee, Democrats thanked their Republican colleagues for the changing their minds on expansion.

“I’m just delighted that you all have picked up this ball that some of us have wanted for 10 years now,” said Sen. Mike Woodard, a Durham Democrat. “I hope we can pick it up together and carry it across the goal line.”

The bill includes a work requirement. The Biden administration has rescinded Medicaid work requirements in states that had them approved under the Trump administration.

It was clear during the committee discussion that not all sections of the Senate bill are universally popular.

The NC Medical Society wants Medicaid expansion but doesn’t want advanced practice registered nurses to be able to work independent of doctors’ supervision, said Medical Society CEO Chip Baggett. Doctors have been fighting increased autonomy for advanced practice nurses for years, and several senators questioned the move Wednesday.

Jordan Roberts of the John Locke Foundation said the legislature should drop the expansion and stick with “supply side reforms.”

The bill would have a major impact on hospitals.

Hospitals have worked for Medicaid expansion for years, but they’ve also fought to keep the Certificate of Need law and don’t want to change it now.

“Any changes to the program would put already vulnerable hospitals at much greater risk of having to make difficult decisions as new entrant healthcare providers could pick off commercially insured patients without taking on responsibilities of caring for Medicaid, under-insured or uninsured patients,” association spokeswoman Cynthia Charles said in an email.

Hospitals’ finances have been strained since the pandemic because they are facing a labor shortage that has forced them to use more expensive contract workers, she wrote. Hospitals have faced “frequent claim issues” under the Medicaid managed care plans, and were hit with an unexpected $200 million state tax last year.

“At a time when hospitals are dipping into their reserves to fund operations, this is not the time to lean on hospitals to fund expansion, or to look at repealing or changing the current certificate of need law,” Charles wrote.