More Georgia Republicans want to expand Medicaid, but it will be tough

The conservative backers of an expansion still don’t know what shape it would take, how much it would cost and whether they have enough support to reach a vote in next year’s legislative session. But they say it is past time for Georgia to begin accepting tens of billions in federal money to expand coverage to more than 600,000 low-income residents.

They face the same objections that thwarted past attempts. Gov. Nathan Deal and legislative leaders have yet to sign on. Grass-roots GOP activists remain firmly opposed. Georgia lawmakers have made it harder to expand by giving lawmakers, and not Deal, the power to authorize it. And the most reliable allies to pro-expansion forces are Democrats, vastly outnumbered in both legislative chambers.

But backers point to recent developments that could play to their advantage.

Powerful business interests have endorsed an expansion, setting up another potential fight between the Republican base and the corporate forces that led to the downfall of "religious liberty" legislation this year. Politicians won't have an election looming in 2017. And it will come as lawmakers prepare for a brutal debate over whether to extend a tax that plugs a gaping hole in the state Medicaid system.

"I just think lawmakers are weary of searching around and digging in the trenches for other money. We've got this pot of money here that's ready to be tapped," said state Sen. Renee Unterman, who once opposed expansion but has changed her mind. "And if we don't, how many other issues are going by the wayside? To me, that's the shame."

Unterman, the chairwoman of the Senate’s health committee, is working with a handful of other Republicans to gather steam behind the initiative next year. Some are new converts to the cause, frustrated with the financial struggles of rural hospitals and trauma centers. Others bucked the party line years ago to endorse an expansion.

‘Variations … will be discussed’

As 32 other states expanded the government-financed health insurance program — including about 10 that embraced conservative alternatives — Deal and many fellow Republicans have staunchly opposed following suit.

They point to a projection that shows it could cost at least $2.5 billion over a decade as federal funding for the expansion tapers off. And they’re backed by grass-roots opposition. At the Georgia Republican Party’s state convention in Augusta this month, GOP delegates resoundingly endorsed a resolution opposing the extension of the program.

State Rep. David Stover, R-Newnan, echoed a familiar complaint that the White House's promise to subsidize the program can't be depended upon in the long term. The law requires the federal government to cover 100 percent of the cost for three years and then gradually scale back its support to a permanent level of 90 percent.

“The gridlock in D.C. is the exact reason that we should not expand Medicaid in Georgia,” he said, adding: “Who will have to pick up the slack for the cuts once Medicaid has been expanded? Quite simply, the states will.”

Yet Deal and other Republicans have given themselves a bit of wiggle room.

The governor's advisers have quietly studied ways other states have expanded their programs and his administration briefly flirted with an "experiment" to apply for new federal funds that could shore up rural and safety-net hospitals.

“I still have the same concerns. And you won’t see anyone advocating a wholesale Medicaid expansion,” Deal said in an interview. “But I do think there will be variations that will be discussed, and I look forward to talking to members of the General Assembly.”

The Republican-controlled Legislature passed a law in 2014 that gave the legislative branch the final say over the debate, making it far more difficult to expand the program. Now, instead of putting the decision in the hands of one politician, it will take 91 votes in the House and 29 in the Senate to expand. But legislative leaders have not slammed the door shut.

“There are major challenges any time you look to alter a joint federal and state program, and I’m always reluctant when we as a state become more dependent on the federal government with all the uncertainty in Washington,” Lt. Gov. Casey Cagle said. “We are constantly looking at ways to improve our health care system, and Senator Unterman is very knowledgeable in this space and always willing to engage in difficult discussions.”

Conservative supporters of expansion point to the staying power of the Affordable Care Act — which has been upheld in a string of legal victories and safeguarded by Senate Democrats — and the turmoil rocking health care facilities.

Dozens of rural hospitals face acute funding shortfalls — at least nine have shuttered since 2001, and many others are considered "financially fragile." The most recent to fail, the North Georgia Medical Center in Ellijay, shut down this month amid substantial financial losses.

"Expansion is inevitable, I just don't know what we're going to call it," said state Sen. Fran Millar, R-Dunwoody. "We've got to put it in context and look very seriously at it. It's a lot of money, and you've got rural hospitals closing."

The expansion’s advocates have zeroed in on a few models from conservative states whose leaders pursued market-driven ways to grow their Medicaid programs. The Georgia Chamber of Commerce, the powerful business group that enlisted a former top Deal aide in its lobbying effort, is expected to endorse a version before lawmakers return in January.

Arkansas used Medicaid dollars to buy private insurance for the poor through a government-run marketplace. Arizona coupled its Medicaid expansion with a self-assessed fee on hospitals to help pay for the program. Indiana requires even the poorest of enrollees to contribute each month for vision and dental benefits.

‘Bed tax’ is up for debate, too

The debate will land before the Legislature as lawmakers grapple with another tough decision on Medicaid.

Georgia lawmakers in 2013 voted to renew a fee on hospitals to avert a roughly $700 million hole in the state's health care budget, approving a funding mechanism known as the "bed tax" on hospitals designed to leverage more federal Medicaid funding that was labeled by critics as an onerous tax hike.

That tax is set to lapse next year, and lawmakers will have to decide whether to extend it or find other revenue to bridge the gap. Unterman said it’s perfect timing to consider a broader change to the Medicaid system.

"That was the most contentious and fractured our caucus has been," she said of the 2013 debate. "But I don't think you can be timid. You are operating in a system that costs hundreds of millions of dollars and you can't be timid."

They'll be able to rely on support from Democrats in the Legislature, who have long fruitlessly searched for a compromise plan. State Rep. Calvin Smyre, a Columbus Democrat who has served in the Legislature for more than 40 years, said he's huddled with Republican leaders in hopes of hashing out a consensus before next year's session.

“The only way we can accomplish something is to be tolerant and try to come up with some sort of solution,” he said. “You have to move some in terms of the dialogue and the debate. And when you look at what other states have done, you see it’s something Georgia can do, too.”

Supporters are cautiously optimistic, but every legislative session brings new hope. Still, Tim Sweeney, a health policy analyst for the left-leaning Georgia Budget and Policy Institute, said momentum seems to be on the side of expansion advocates.

“The conversations that once were only discussed in private are now getting broader, open debate,” he said. “Other states have found a great deal of flexibility to administer their programs. There’s no reason Georgia can’t do the same.

To get any traction, expansion supporters have to convince enough rank-and-file lawmakers that it's worth putting their political careers on the line. State Sen. Larry Walker III of Perry won office in a special election in his deep-red district on a platform of fiscal conservatism and bringing "Middle Georgia common sense" to the statehouse.

Press him on the divide over Medicaid and he seems receptive to reopening the debate.

“I want to learn more about it. My sole interest is ensuring that rural Georgians have access to quality health care and we can grow jobs in rural Georgia,” he said. “Rural hospitals are closing and others are in financial straits, and I’m concerned about access to health care in rural Georgia.”