Walker Introduces Medicaid Expansion Bill

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After failing to expand Medicaid through a budget item, Gov. Bill Walker is trying again. He has introduced a standalone bill that would allow the state to accept federal funding for Medicaid expansion, while also offering
some reform measures.

When he was campaigning for governor, Bill Walker aggressively stumped on the issue of Medicaid expansion.

“There was never a time when we brought this up where there wasn’t instantaneous applause,” he said.”>>

Now that Walker is in office, getting the state to accept $146 million in federal funds to grow the pool of Medicaid recipients has been one of his top priorities.

First, Walker tried to secure the money through a line in the operating budget, but a House Finance subcommittee stripped that out. Then, Walker said the Legislature should consider an expansion bill by the House
Democratic Minority. That didn’t move. Next, he collaborated with a Republican senator on a reform bill, but the product offered did not include expansion. Now, Walker is doing something that legislators have
requested of him since the beginning of session.

“We have transmitted legislation for Medicaid expansion, Medicaid reform,” he said.

Walker made the announcement in the Capitol’s cabinet room, with two dozen supporters of Medicaid expansion behind him.

Right now, the state’s Medicaid program mostly covers low-income children and pregnant women. The nine-page bill makes it so that Alaskans with incomes up to 138 percent of the federal poverty level — about $20,000 a year for a single adult — can get coverage, too. There are 42,000 Alaskans eligible for Medicaid expansion, with some covered by Indian Health Services but other falling into a gap where they’re required to get health insurance by law but ineligible for subsidies because they don’t make enough. The federal government would pay the total cost of expansion in the first year, and then ratchet that down to 90 percent in the year 2020. The Walker administration expects about 20,00 eligible Alaskans to enroll within a year of expansion.

But Walker stressed that his bill wasn’t just about providing health care
to more people.

“It is a catalyst for reform,” he said. “We heard a lot about reform, and reform has been ongoing. Reform is part of this legislation.”

When asked to elaborate on specific reform measures, Walker mostly deferred to his health commissioner and his budget director. Commissioner Valerie Davidson described the promotion of telemedicine to bring costs down, and
added that bill would allow Alaska to apply for waivers to increase their federal match for some health care costs.

One waiver would allow Indian Health Services beneficiaries to have care from tribal providers totally covered by the federal government.

“That allows us to realize a potential savings of between $80 and $150 million.”

Walker’s budget director, Pat Pitney, explained that the bill also starts the process of implementing a provider tax, where up to six percent medical services can be taxed as revenue for the state.

“The provider tax would bring in more than the corporate tax for health providers,” Pitney said.

That tax would need approval from the Legislature in a future session.

After rolling out the bill, the Walker administration gave the Medicaid supporters the microphone. They were wearing buttons that read “It’s the right thing to do,” and most came from various health and trade groups. The
Alaska Hospital and Nursing Association, the Alaska Mental Health Trust, and the National Education Association were all represented, and they talked about the good expansion would do for their organizations and the
people they service. But there were two people in attendance who would directly benefit from Medicaid.

Steven Grundstein, a 53-year-old Juneau man, stood at the podium and announced he had a terminal kidney disease and could need dialysis within months. He said he found himself in the health care gap, and that getting
help has been difficult.

”Everyone is passing you around like a football,” he said.

Grundstein added it was difficult watching the debate over expansion, as someone affected by it.

“In politics, things go bad. I’ve seen too many bills start out with really good intentions and then go horribly wrong. Let’s try not to let the horribly wrong happen here.”

Legislators were still processing the bill on Tuesday afternoon. But some key players, like Sen. Pete Kelly, a Fairbanks Republican, reacted favorably.

Kelly had offered his own reform bill, and he said he was glad to see legislation on the issue from the governor. He said some of the reforms in each could be complementary. But Kelly said that expansion remains a
sticking point for him.

”We’re going to disagree on expansion. That’s the big thing,” Kelly said.

Kelly added that he did not want to add people to a “broken system.”

Hearing on the governor’s Medicaid bill are expected to be held starting next week.