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The gloves are off in the fight over Medicaid expansion in holdout states

The gloves are off in the fight over Medicaid expansion in holdout states

Picture of Trudy  Lieberman
(Photo by Joe Raedle/Getty Images)
Pro-expansion advocates have tried to counter with stories of state residents who have been cut off from health care because the state has not embraced expansion.
(Photo by Joe Raedle/Getty Images)

Editor's Note: This column has been updated to note a correction that Nebraska's Medicaid expansion required prime members to work 80 hours a month, among other requirements, not 80 hours a week.

The Affordable Care Act (ACA) has yet to guarantee health care for all eligible Americans. Indeed, some states are working very hard to keep some of their eligible residents off the Medicaid rolls, thwarting the federal government’s intent and sometimes the will of voters, who have supported state referendums to implement the expansion called for by the ACA. Other reluctant states have expanded Medicaid but only after imposing onerous work requirements to qualify, essentially casting expansion as a means-tested welfare program instead of an easily accessible health insurance program for Americans in need. 

More than 400 academic studies showing the benefits of expansion — on everything from helping hospitals with the costs of indigent care to encouraging annual check-ups — have failed to persuade state legislators, and 12 states in the South and the Midwest, from the mountains and plains of Wyoming to the swamps and beaches of Florida, continue to deny roughly 2.2 million people a way to pay for medical services. 

Eleven years have passed since the ACA became law, giving America’s poor the ticket to medical care. Nine years have gone by since the Supreme Court told the states they didn’t have to give out that ticket after all. At the beginning of 2015 only 25 states had expanded their Medicaid programs, a move that gives residents whose incomes are up to 138% of the federal poverty level (now $17,774 for single people and $36,570 for a family of four) access to coverage and subsidies.

Over the years other states straggled in. But for those dozen states that did not expand, their poorest citizens with incomes below the poverty line have fallen into the so-called coverage gap — a kind of insurance purgatory where they are ineligible for Medicaid and yet unable to receive subsidies to help buy marketplace insurance. Without those subsidies, insurance is out of reach. The ACA assumed states would expand their Medicaid programs, and residents would be eligible for tax credits and other subsidies to buy insurance in the state insurance marketplaces, with the federal government paying most of the cost.

Why do these holdout states remain stubbornly opposed? Racism, a dislike for poor people, and a commonly held but mistaken belief that Medicaid recipients are able-bodied men and women too lazy to work are all at the root of state recalcitrance to expand. But another overarching fear in many of the holdout states is that if millions more participate in a government health insurance program, which now covers some 75 million people, it would be easier to implement a more inclusive government health system, one that resembles European models. In 2018 Fred Birnbaum, vice president of the Idaho Freedom Foundation, a conservative think tank that promotes private free market solutions, expressed that fear to Politico: “If Idaho and Utah and Montana [and] Nebraska and other states expand Medicaid, it will be harder for Congress to reverse that. I think that is going to put us on a path to a … single-payer system.” 

More than 400 academic studies showing the benefits of expansion — on everything from helping hospitals with the costs of indigent care to encouraging annual check-ups — have failed to persuade state legislators.

“A number of people believe it,” said Josh Archambault, a senior fellow at two conservative think tanks, the Foundation for Government Accountability and the Opportunity Solutions Project, which have been instrumental in blocking expansion campaigns in several states this year. Archambault told me that pushing for single payer “is the intent of a subset of Americans,” adding, “You can’t have one system, not a one-size-fits-all.” Archambault also pointed to fears that mostly able-bodied adults without dependents will sign up for expanded Medicaid, and as they do, “they will take away slots from people needing home and community-based care.” He believes health systems will have an incentive “to prioritize able-bodied persons because the reimbursement is higher, adding that another “unintended consequence” would be to “crowd out private spending with public spending.”

The arguments and talking points of both the Foundation and the Opportunity Solutions Project have in turn made their way into the legislative discussions in holdout states this year and have influenced expansion legislation. In Mississippi, an op-ed appearing in the Northeast Mississippi Daily Journal by Jonathan Bain, a research fellow at the Foundation for Government Accountability, argued, “If Obamacare were expanded, the state could expect to see even more able-bodied adults enrolling in the program — at least 358,000.” He added that “nearly 40% of the state could be on Medicaid, and that would ravage our state budget.” The Mississippi Senate twice rejected legislation to expand this year, with at least one state senator picking up the think tank’s talking points and arguing that those who would gain coverage are “able-bodied people” and “childless adults.” 

Similar talking points have influenced policy in Kansas. The Foundation for Government Accountability asserts that the “truly needy individuals with disabilities are trapped on Medicaid waiting lists and that expansion gives “limited taxpayer resources to a new welfare class of able-bodied childless adults.” Americans for Prosperity, a conservative-libertarian group financed by the Koch family, argued that “adding able-bodied, working age adults to this program makes it harder for the truly needy already using Medicaid to get care.” Arguments such as those similar to ones from the Opportunity Solutions Project carried weight with the legislature in Kansas, which had become more conservative in the 2020 election, says April Holman, executive director of the Alliance for a Healthy Kansas, a 120-member advocacy organization pushing for expansion. Kansas, she pointed out is home turf to the Koch family enterprises, which carry a lot of weight in the legislature. “Opponents were very strong and kept us from succeeding,” she told me. “Now we have lost ground.” 

The story in Wyoming is similar. For a moment, it seemed, there might be a breakthrough when the state House of Representatives passed a bill to add as many as 24,000 residents to the Medicaid rolls. But the vote was defeated in a Senate committee. When the bill began to gain momentum, the Foundation for Government Accountability whipped into action,” says Nate Martin, executive director of Better Wyoming, a state advocacy group supporting expansion. “Twenty people spoke on the floor and hit all the Foundation's talking points,” Martin told me. “They obviously worked with members of the far-right caucus. Each individual representative had talking points that were from the Foundation, most of which were contained in a report distributed that morning.” The Senate committee voted it down by a vote of 3 to 2.  However, the state’s Joint Revenue Committee has adopted expansion as a topic to consider during the interim session this summer, Martin said.

Americans for Prosperity, a conservative-libertarian group financed by the Koch family, argued that “adding able-bodied, working age adults to this program makes it harder for the truly needy already using Medicaid to get care.” 

Missouri voters did actually pass a statewide referendum on Medicaid expansion there last summer, with 53% of the voters approving the measure. But so far the state legislature has refused to appropriate the needed funds to implement the law — about $130 million — to match the federal government’s contribution of $1.4 billion. In late March, GOP lawmakers in the state senate blocked the expansion funding. The talking points of the Opportunity Solutions Project also appeared in Missouri. The Project’s website asserted: “In every state that has expanded Medicaid to able-bodied adults who are capable of working, we see the same disastrous results: hospital closures, shattered enrollment projections, and unsustainable skyrocketing costs.” Dirk Deaton, a Republican vice chair of Missouri’s House Budget Committee, said the expansion gives “free health care, government health care to able-bodied adults who can do for themselves.”

He added that the budget bills present “binary choices” between Medicaid expansion and social services for blind and disabled Missourians, expanding on opponents’ arguments.  Another Republican legislator, Cody Smith, who chairs the House Budget Committee, said “expansion is wrong for Missouri” and “wrong for the state budget,” claiming the “federal government has no money — there is only tax dollars,” which are being spent “at a rate that is unprecedented at this point.”

The Opportunity Solutions Project praised Smith for his stance, noting the House Budget Committee’s “strong leadership in standing up for what is right in the Show-Me state.” The Project added that Smith and House Budget Committee Republicans “have made it clear that in Missouri, the voiceless and the vulnerable are first in line to receive state resources” — a dog-whistle reference to the able-bodied folks who are capable of working and therefore shouldn’t qualify for Medicaid.

As of last Friday, Amy Blouin, who heads the Missouri Budget Project, said it didn’t appear that the legislature would include expansion in the budget. “Voters placed Missouri Medicaid expansion in the state constitution. It’s the law of the land. As a result a court case is likely to require implementation.”

Dirk Deaton, a Republican vice chair of Missouri’s House Budget Committee, said the expansion gives “free health care, government health care to able-bodied adults who can do for themselves.”

Expansion advocates are also turning to legal action in neighboring Nebraska, a state where voters also approved Medicaid expansion in 2018 after the state legislature refused to do so six times. Last fall the expansion began with a two-tiered system to get coverage. Under the basic plan, people receive bare-bones Medicaid benefits but no coverage for dental, eye care and over-the-counter drugs. To become a prime member, enrollees must satisfy additional requirements, which include working 80 hours a month or volunteering the same amount of time for a public charity, enrolling in an educational program, being a qualified caregiver or a foster parent, or engaging in job search activities for at least 20 hours a week.

Nebraska is automatically assigning people to the basic-plan group. In February, the Centers for Medicare and Medicaid Services sent a letter to the state challenging the state’s work requirements and beginning a process to withdraw its Medicaid waiver. The state has so far maintained the two-tiered structure but has not implemented the work requirement. As it stands, only medically frail people — for example pregnant women and those with chronic conditions — can access the enhanced benefit package. Nebraska Appleseed, an advocacy group in Lincoln, has filed a suit challenging the two-tiered system, arguing it is putting “putting barriers on this group of people that no other population has to go through,” said Molly McCleery, a program director at Appleseed. “The expansion population is facing unnecessary barriers to health care services in violation of the voter-passed initiative,” she said.  “The state has certainly put a lot of administrative effort, time and funds into not giving people benefits under the law that was passed.”    

In North Carolina, a right-wing public policy think tank active in the state, the John Locke Foundation, has been clear about its hostility to Medicaid expansion there. In the Carolina Journal, a publication of the Foundation, a February opinion piece written by Donald Bryson, the president of the Locke Foundation, said that the “rejection of Obamacare’s Medicaid expansion has helped protect North Carolina from a critical aspect of the federal government’s health care takeover.” Reprising the same argument advanced in other holdout states, Bryson argued, “expansion would add thousands and thousands of able-bodied childless, working-age adults to Medicaid, which would further exacerbate the problem of access to quality care for the neediest North Carolinians.”      

Pro-expansion advocates have tried to counter with stories of state residents who have been cut off from health care because the state has not embraced expansion. Renita Webb, a 39-year-old mother in Elon, North Carolina, is one of them. Webb, a former teacher, was downsized from her job as a principal and will likely lose another job as a program director for an after-school program that is nearing the end of its grant. She currently does not have health insurance.  Her own young children are on Medicaid, and her husband, who served in Kuwait and has a service-related injury, gets VA benefits. She doesn’t qualify for Obamacare, because she falls in the infamous coverage gap: Her income is too low to qualify for ACA subsidies and buying private insurance on her own is a financial impossibility — $800 a month is the cheapest premium she could find on the ACA exchange.

Webb told me, “They don’t want to expand because they think people who need Medicaid are not good citizens. They think these people aren’t worth it.” 

The only benefits she qualifies for under North Carolina’s current Medicaid program are for birth control and one physical a year. It’s hard to qualify for Medicaid in the state. A family of three making just $900 a month makes too much to qualify for Medicaid, according to Fawn Pattison, campaign director for the advocacy group NC Child. 

North Carolina came close to enacting Medicaid expansion last year. This year advocates for expansion have had high hopes that something would pass. A key legislator, Republican Phil Berger, the Senate leader, has said he thinks Medicaid expansion is “bad policy,” adding, “Nothing I’ve seen has led me to believe that there’s a reason to change my position on that.” 

Webb told me, “They don’t want to expand because they think people who need Medicaid are not good citizens. They think these people aren’t worth it.” Nate Martin in Wyoming offers another reason: “Facts don’t really matter any more,” he told me. “It’s only ideology.” Next year Medicaid expansion may well be back in all the states I looked at — and also in states in the Deep South where I did not. 

The question will be the same: Will facts trump ideology, or will it be the other way around?

Correction: An earlier version of this story incorrectly referred to Renita Webb's former job, as well as the reason her current job may end. The story has been updated.

Veteran health care journalist Trudy Lieberman is a contributing editor at the Center for Health Journalism Digital and a regular contributor to the Remaking Health Care column.

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