FRANKFORT — The top Republican in the Kentucky House wants Democratic Gov. Steve Beshear to halt an expansion of Medicaid, the federal-state health insurance program for the poor and disabled.
The expansion of Medicaid is a central element in President Barack Obama's Patient Protection and Affordable Care Act, which says the federal government will pay 100 percent of the costs to add certain people to the program in 2014. After three years, the states must pick up some of the costs of the expansion, which Kentucky can't afford, House Minority Leader Jeff Hoover of Jamestown said.
Currently, the federal government pays 70 percent of the costs of the insurance program and the state picks up 30 percent. Under the expansion proposal, after three years the federal government would pay about 90 percent for those people added under the expansion, but the state would have to cover the other 10 percent.
The U.S. Supreme Court recently upheld the controversial federal health insurance law but ruled that states can't be penalized financially if they opt out of the Medicaid expansion. In Kentucky, more than 700,000 people receive insurance through the $6 billion program. It is Kentucky's largest insurance provider.
"Last week's Supreme Court ruling gave the states the legal flexibility to opt out of a massive expansion of the Medicaid program," Hoover said. "On behalf of the House Republican Caucus, I am encouraging Gov. Steve Beshear to do just that and opt out of this financially devastating expansion of Medicaid."
Kerri Richardson, a spokeswoman for Beshear, said the governor has not decided whether Kentucky will go ahead with the expansion. The state is waiting to see how the federal government will adjust the regulations in light of the Supreme Court's decision, Richardson said.
"We will continue to work with our federal partners and the (Cabinet for Health and Family Services) to get a fuller picture of this policy and determine the best course for the state after we have gathered the facts," Richardson said.
It's difficult to say how many people would be eligible for Medicaid under the new rules. House Republicans cite numbers from the Urban Institute showing that 400,000 uninsured Kentuckians who earn less than 138 percent of the federal poverty level would be eligible for Medicaid under the expansion. Other estimates put the number of people eligible for Medicaid under the new rules at fewer than 350,000.
"Such a large increase would have a drastic effect on the financial stability of the Commonwealth of Kentucky, and a detrimental effect on the other functions of government funded through the executive branch budget," Hoover said.
The state would have to raise taxes or further cut other government agencies, which have been decimated by cuts during the past four years, Hoover said.
Senate President David Williams, R-Burkesville, said in a statement late Thursday that he was concerned about the growing costs of the program, but he stopped short of calling on Beshear to opt out of the expansion.
"We are very concerned about adding a $500 million yearly expense to our budget along with the demands of education, corrections and the judiciary, and public pensions, plus the health care costs of the most vulnerable already in the system," Williams said. "We agree that adding such huge numbers to Medicaid rolls would be unsustainable."
He said Senate Republicans were "carefully analyzing" the effect of the Supreme Court's ruling on Kentucky's budget.
Proponents of the Medicaid expansion say Kentucky's uninsured — an estimated 1 million people — are driving up health care costs for every Kentuckian. The uninsured often don't pay, and those costs are passed on to Kentuckians who do have health insurance.
House Speaker Greg Stumbo, D-Prestonsburg, said he supported the expansion of Medicaid.
"I think that Americans have a right to accessible and affordable health care, and the more we expand coverage to meet that goal, the lower health care costs will be for all of us," Stumbo said.
Twenty-five governors have not said whether they will continue with an expansion of Medicaid.
At least five Republican governors — in Wisconsin, Louisiana, Mississippi, South Carolina and Florida — have said they will not proceed with the expansion..
Democratic governors in nine states have said in the week since the Supreme Court ruling that they would move forward with plans to expand. Four governors have given some indication they are leaning toward expansion of the program.
Kentucky moved the bulk of its Medicaid population — more than 550,000 people — into managed care on Nov. 1 to control costs and in anticipation of an influx of new Medicaid enrollees in 2014.