Deal rejects expansion of Medicaid

Gov. Nathan Deal said Tuesday that he will not expand the Medicaid program under the federal Affordable Care Act — which would have provided an estimated 650,000 low-income Georgians with health coverage — because it would be too expensive.

Deal had said that he would wait until after the presidential election to decide, but during an interview with The Atlanta Journal-Constitution, 11 Alive and Politico at the Republican National Convention, Deal was firm that he will not take federal money to expand the state-based health insurance program for the poor in 2014.

“No, I do not have any intentions of expanding Medicaid,” Deal said. “I think that is something our state cannot afford. And even though the federal government promises to pay 100 percent for the first three years and 90 percent thereafter, I think it is probably unrealistic to expect that promise to be fulfilled in the long term, simply because of the financial status that the federal government is in.”

The stance drew praise from some of Deal’s fellow Republicans, while supporters of the health care law said they hope for a change of heart.

“Consumer patient advocates obviously feel very, very strongly that this is the opportunity of a lifetime to address the intractable and abysmal health access and outcome indicators we have in Georgia by covering some of the uninsured,” said Cindy Zeldin, executive director of Georgians for a Healthy Future.

But U.S. Sen. Saxby Chambliss, R-Ga., called Deal’s decision “smart.”

“We know there’s going to be money taken from other programs to fund Medicaid,” said Chambliss, who added that he and Deal frequently discuss the program when they meet. “Or else he’s going to have to raise taxes, and that ain’t going to happen. So I think he’s doing the right thing.”

The controversial 2010 health care law included an expansion of Medicaid coverage to families making up to 133 percent of the federal poverty level, or about $31,000 per year for a family of four. But the U.S. Supreme Court, when it partially upheld the law this past June, allowed states to opt out of the expansion if they choose.

Under the law, families who make between 133 percent and 400 percent of the poverty level are eligible for subsidies to buy health insurance from a menu of plans on state-based exchanges. It is unclear what would happen to those left uncovered in states that choose not to expand Medicaid.

Medicaid eligibility currently varies in Georgia, with more leeway for pregnant women and young children. For a family of four with children between the ages of 6 and 19, the income limit is $23,000. About 20 percent of Georgians do not have health insurance, one of the highest rates in the nation.

Deal joins a handful of Republican governors, including Rick Perry of Texas and Rick Scott of Florida, in rejecting the expansion. Others have said they will wait and see. Former Massachusetts Gov. Mitt Romney, who was formally nominated for the presidency Tuesday at the Tampa convention, has vowed to repeal the law if elected, though the GOP likely would have to win control of the U.S. Senate as well for that to occur.

State officials estimated that the Medicaid expansion would cost Georgia $4.5 billion over 10 years, and the state already is facing a $300 million shortfall this year for the program.

State House Speaker David Ralston, a Republican, agreed with Deal’s fiscal reasoning.

“The costs are enormous and there is little faith that the federal government will live up to the funding requirements of Obamacare as it stands now,” Ralston said in a statement, using a term Republicans employ derisively to describe the health care law.

Timothy Sweeney, the director of health policy at the Georgia Budget and Policy Institute, which advocates for new revenue sources over budget cuts, said the fuss is too great over a relatively small portion of the state’s yearly budget. The estimated $450 million yearly tab would have been 2.3 percent of Georgia’s most recent budget of $19.3 billion.

“That is hardly a number that should be considered blowing a hole in the state budget,” Sweeney said. “And it doesn’t look at the impact beyond the expansion on the economy of those billions of dollars going to health care providers, the impact on the health care system of a dramatic reduction of uncompensated care and making the system more efficient.”

U.S. Rep. Hank Johnson, a DeKalb County Democrat, touted the economic benefits of a $36 billion federal spending infusion, calling Deal’s decision “penny wise but pound foolish.” He added that Deal’s comments while attending the GOP convention “will play well to that Paul Ryan audience.”

Ryan, the U.S. House Budget Committee chairman and Romney’s running mate, has proposed to transform Medicaid into a block grant program for the states and considerably reduce federal spending on it.

Deal backed that idea, saying a block grant would give Georgia needed flexibility.

“We [in Georgia] are in one of the more modest Medicaid programs in the country,” Deal said. “Those states that have seen fit to expand their Medicaid populations, quite honestly I don’t understand how they’re affording it in this downturned economy. … We think we might be able to come up with some innovative ways to serve that population better and at the same time save money.”