Brewer's Medicaid details are revealed; $240 million cost to state of first year funded by hospitals; payoff is $1.6 billion

$240M cost to state of first year funded by hospitals; payoff is $1.6B
2013-03-13T00:00:00Z 2013-03-13T11:28:18Z Brewer's Medicaid details are revealed; $240 million cost to state of first year funded by hospitals; payoff is $1.6 billionHoward Fischer Capitol Media Services Arizona Daily Star
March 13, 2013 12:00 am  • 

PHOENIX - Gov. Jan Brewer finally gave lawmakers a peek Tuesday at details of her plan to expand the state Medicaid program, in a bid to whip up enough support to win approval.

The legislation contains the basics of what she proposed in January in her surprise announcement during her State of the State speech: Boost eligibility for the free care from 100 percent of the federal poverty level to 138 percent - about $26,000 a year for a family of three.

It would cost the state about $240 million the first year. But that would be paid through what amounts to a tax on hospitals.

The trade-off is that Washington will provide $1.6 billion in federal funds, and about 300,000 people will be added to the Arizona Health Care Cost Containment System, the state's Medicaid program, which already has about 1.2 million Arizonans enrolled.

Democrats are generally supportive. But they hold just 13 of the 30 Senate seats and 24 of 60 in the House. And Brewer has so far been unable to persuade a majority of the legislators from her own Republican Party to go along.

House Speaker Andy Tobin said it is unlikely he would allow a measure to be brought to the floor without the support of a majority of his GOP caucus.

The governor is trying to turn votes her way, one by one, both by personal persuasion and by building support among the constituents of recalcitrant lawmakers.

"I'm going to work as hard as I know how," Brewer said Tuesday after a rally on the Capitol lawn. "I believe that by educating and talking to people and sitting down, spreading what this all means to the state of Arizona could very well change their minds."

But Tobin pronounced the draft Brewer provided lawmakers on Monday dead on arrival, perplexing the governor.

"What does Speaker Tobin want?" she asked.

What Tobin wants, he said, is an assurance hospital bills will stop going up if Medicaid is expanded.

Proponents contend there is a "hidden health-care tax" of about $2,000 per Arizonan - the amount hospitals increase their bills to those who can pay, both individuals and insurance companies, to make up for what they lose from the uninsured who cannot pay their own bills.

Tobin said he wants assurances in the legislation that if hospitals, many of which are for-profit operations, have less "uncompensated care" they will stop transferring costs to the private sector.

He conceded it may be difficult to rein in existing costs, which have hospitals charging several dollars for an aspirin to balance their books. "But wouldn't you think for a moment that they shouldn't be able to increase them to the commercial sector?"

There are other objections to the governor's plan.

One is Brewer's end run around a constitutional provision that requires a two-thirds vote for any tax increase. Both Tobin and Senate President Andy Biggs say that's exactly what is being imposed on hospitals to pay the state's share.

Brewer has structured the legislation to allow the AHCCCS director to impose an annual "assessment," which aides contend removes the need for a supermajority.

Tobin, however, said he believes it is unconstitutional to put that much power in the hands of a state agency chief without legislative oversight.

Brewer hopes to sell the expansion as a deal too good to pass up.

She figures tapping into the federal Affordable Care Act will generate $8 billion in federal funds over the next four years, and even though that has federal tax and deficit ramifications, "It will keep Arizona's tax dollars at home rather than allowing them to go to Washington to be spent on who knows what," she said.

And if Arizona does not go along with the higher eligibility standards, the federal government will no longer subsidize funding for childless adults below the federal poverty level, which would leave 60,000 Arizonans who now have insurance without any next January.

Even as Brewer is trying to line up votes, Republican Party workers around the state are trying to line up opposition.

A.J. LaFaro, chairman of the Maricopa County Republican Committee, sent letters to GOP lawmakers pointing out that its Executive Guidance Committee voted 26-2 last week in opposition to what Brewer is trying to do.

On StarNet: Go to azstarnet.com/politics to read more on local, state government and political news

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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