Expanding the Umbrella: Medicaid Expansion 2015 Review and New Year's Preview

With 2016 right around the corner, and several new governors moving into office, it's as good of time as any to take stock of where the Medicaid expansion has gone and the prospects for progress in the new year.  Despite massive Democratic setbacks at the state level in the 2014 midterm elections, Medicaid expansion fared reasonably well in 2015, and 2016 posts several opportunities for new states to expand as well, as well as one at risk of backsliding.

First, we visit the ghosts of Medicaid expansion past:

As Chart I shows,  the ACA Medicaid expansion has proceeded at a similar overall pace to the original Medicaid take-up in the late 1960s, though the holdouts to Obamacare are likely to offer stiffer resistance than the late adopters of the initial program.

Democratic defeats in the 2014 elections likely prevented expansions in Maine and possibly Florida, and may have influenced resistance to expansion plans in several other states, including Tennessee, Utah and Wyoming. However, Four new states joined the expansion -- Indiana, Pennsylvania, Alaska, and Montana -- which increases the number of states fully expanding Medicaid from 26 to 30. 

Head below the fold for state-by-state analysis and a peak at 2016.

Medicaid Expansion Keeps Stumbling Forward -- and Proves Surprisingly Resilient

With the results of the 2014 elections, the pace of Medicaid expansion has become frustratingly slow for progressives.  However, the overall picture has two very important positive points for those seeking to provide universal health care in this country. First, despite meeting several setbacks and roadblocks recently, the expansion continues to grind ahead –excruciatingly slowly, but ahead all the same -- to new states. Second, recent developments in Arizona and Arkansas suggest that a state’s expansion may be durable even in states that get taken over by hard-right governments.

On the first point, Indiana joined the parade of Conservative states expanding Medicaid under a waiver in January. Pennsylvania, under its new Democratic Governor Tom Wolfe, has thrown out the complicated waiver plan submitted by outgoing governor Tom Corbett and is replacing it with a traditional expansion more congenial to beneficiaries (elections matter). Frustrating setbacks have happened in Tennessee and Wyoming, when legislative committees defeated plans negotiated by their governors to expand Medicaid, at the behest of an Americans for Prosperity pressure campaign. However, Utah and Montana are still considering their own plans – and Kansas(!) of all places looks like it may join soon too. Vox, as usual, has the snappy summary.

The second point is more interesting and, for now, just as encouraging. In 2013, Arkansas had negotiated an expansion with waivers under Democratic Governor Mike Beebe to mollify the Republican-controlled legislature. However, it looked like the plan might not survive new Republican Governor Asa Hutchinson and a much larger and more conservative Republican majority elected in 2014. But Hutchinson got behind the program with a few tweaks and convinced the legislature to approve it for another two years while forming a committee to seek a new waiver in 2017.   

In Arizona, the situation appears more ambivalent. Outgoing Republican governor Jan Brewer choose to expand Medicaid in 2012 over howls of protest from conservatives in her legislature. Incoming Governor Doug Ducey has suggested he’s against the expansion, while conservatives made gains in the Arizona statehouse in 2014. Medicaid expansion looked doomed.

But an in-depth examination of legislation Ducey just signed trying to curtail the expansion is instructive. The legislation consists of two Republican pet rocks: attaching work requirements to Medicaid recipients, and limiting beneficiaries to five years total of receiving Medicaid before throwing them off the program. It’s an ugly bill. But notice that the law doesn’t eliminate the expansion, it only attempts to modify it with issues a GOP legislator could plausibly defend as “common-sense reforms.”More importantly, any of these changes would have to be negotiated with the Federal Department of Health and Human Services.

At least for the next two years, those negotiations are going to go like this:

ARIZONA: “We want you to give us a waiver to create work requirements for beneficiaries and throw them out of Medicaid after five years” (hands over proposal).

HHS SECRETARY BURWELL: “Would it annoy you if I did this?” (Folds proposal into paper airplane and tosses it back at Arizona’s forehead)

The bill binds Arizona state officials to go back to the Feds every year and beg for the waiver.  Those conversations are going to go like this:

ARIZONA: “We want you to give us a Medicaid waiver to…”

BURWELL: (Takes proposal. Blows nose on proposal. Crumples it up and hands it back)

What we have here is Politics 101: it allows Arizona Republicans to both whine loudly about how horrible the federal government is, while looking like they are doing something to fight the dastardly Obamacare Medicaid expansion by writing sternly worded letters. They also get to quietly take advantage of all its benefits (including federal funding) that will remain at least as long as a Democrat controls the White House.

So at first glance, at least, the Medicaid expansion is looking surprisingly resilient, even in its infancy. Despite the poor results of the 2014 elections, the expansion continues to meander forward in several states. And every state that takes the expansion may have quite a hard time getting rid of it. This stickiness is good news for justice and for hundreds of thousands of people who get access to health care.