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Replacement for voter-approved Medicaid expansion passes Senate

By Lisa Riley Roche, KSL | Updated - Feb 4th, 2019 @ 3:42pm | Posted - Feb 4th, 2019 @ 10:32am

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SALT LAKE CITY — The Senate gave final approval today to a replacement plan for the voter-approved full Medicaid expansion after more than an hour of debate — and a last-minute update to the price tag.

The bill now goes to the House.

The 22-7 vote — with all six Democrats and Sen. Todd Weiler, R-Woods Cross, opposed — didn't change from the initial vote on SB96 last week, on the third day of the 2019 Legislature.

What did change, however, was the fiscal note spelling out the cost to taxpayers. The new version of the bill also includes a provision that would wipe out Medicaid expansion if the federal government doesn't come through with needed approvals.

Sen. Allen Christensen, R-North Ogden, the sponsor of SB96, said the goal of amending the November 2018 ballot initiative known as Proposition 3 is to ensure long-term stability for what would be a more limited Medicaid expansion plan.

Christensen said under his plan, the state does have to spend more money up front than called for under Proposition 3. But he said full Medicaid expansion is not financially sustainable.

SB96 provides Medicaid coverage to Utahns earning only up to 100 percent of the approximately $12,000 federal poverty rate initially at a lower federal to state funding match of 70 percent to 30 percent.

The full Medicaid expansion approved by voters in November covers Utahns earning up to 138 percent of the federal poverty rate at a federal to state funding match of 90 percent to 10 percent.

Proposition 3 included a 0.15 percent sales tax increase to pay for the state's share of full expansion, but Christensen's bill adds an initial $38.2 million appropriation and $15 million annually in future years plus $15 million from a hospital tax.

Senate Democrats argued voters want full expansion.

"The majority rules, supposedly," Sen. Gene Davis, D-Salt Lake City, said, noting no state has been granted the type of waivers sought. "I think it's time that we do what the people asked us to do and not play games."

Another Salt Lake Democrat, Sen. Derek Kitchen, said he "worried about sowing seeds of distrust" among voters, especially with "a plan that appears to cost more and cover fewer people."

Republicans said the state can't afford Proposition 3.

"A majority of voters cannot overrule the laws of mathematics," Sen. Lincoln Fillmore, R-South Jordan, said.

Sen. Jake Anderegg, R-Lehi, who has a bill repealing Medicaid expansion that has yet to have a committee hearing, said voters didn't understand Proposition 3 was "a bait and switch."

Anderegg said other states that have expanded Medicaid coverage have called it a "nightmare."

Sen. Daniel Thatcher, R-West Valley City, said lawmakers don't have much choice.

"The question is, 'What is the least bad of the bad options in front of us.'"

Andrew Roberts, spokesman for Utah Decides, the group behind Proposition 3, said the Senate vote "threw the baby out with the bath water. They presented a false choice here. The reality is we still have no plan to get this waiver from the federal government and if we fail to do it we’ll have 150,000 people that are now left out of this process."

The group has launched a campaign including more than $100,000 in TV commercials aimed at pressuring lawmakers to back off of replacing full Medicaid expansion.

Both fiscal notes released Monday by the Legislative Fiscal Analyst's Office for the plan backed by GOP legislative leadership showed the state could end up forgoing more than $1 billion in available federal funding.

Compared to current law, the fiscal note said Utah could forgo federal funds of $100 million in the current budget year, $401 million in the budget year that begins July 1, and $624 million ongoing by the 2024 budget year.

That adds up to well over $1 billion, but Senate Majority Whip Dan Hemmert, R-Orem, said "that's misleading unless you match it with reduced expenses." He said starting in the budget year beginning July 1, 2020, the voter-approved program was expected to be in the red.

Both the full Medicaid expansion program available under the Affordable Care Act that was passed by voters and the Republican supermajority's plan are set to take effect April 1.

However, unlike the program in Proposition 3, the SB96 plan would require federal waivers to implement what's being called a bridge program at the 70-30 federal match while seeking approval to receive the 90-10 match for covering fewer people.

If those waivers don't come through, the new provision in SB96 would end Medicaid expansion in the state.

Hemmert has said there are 41,000 Utahns making 100-138 percent of the poverty rate who already have insurance offered at a federally subsidized rate of less than $30 a month, but another 24,700 in that category don't.

He counts the federal insurance subsidizes as money coming into the state even though it is outside the Medicaid expansion plan, estimating the amount at between $311 million and $625 million.

"So yeah, the money doesn't run through the state budget, but the federal money is still coming here. No one is forgoing anything," Hemmert said. The federal insurance subsidy is not part of the fiscal note.

Contributing: Katie McKellar


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