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Anti-Obamacare South Warms to Medicaid Expansion

Most Southern states have refused for years to make more people eligible for government health care. But a few governors may change that.

Alabama Gov. Robert Bentley appears to be giving up his fight against Obamacare.
(AP/Brynn Anderson)
When Robert Bentley ran for governor of Alabama in 2010, the retired dermatologist’s campaign slogan was “Alabama is sick, and we need a doctor.” What Alabama didn't need, according to Bentley, was the Affordable Care Act (ACA), also known as Obamacare. So when it came time to decide whether to expand Medicaid to more low-income people (a provision of the ACA), Bentley joined many other Republican governors in rejecting it.

To date, 30 states have opted to expand Medicaid and 20 states -- mostly traditionally red ones -- have refused. But that may be changing -- in Alabama and beyond.

Earlier this month, Bentley said he was “looking” at the possibility of expanding Medicaid after a commission that he appointed recommended doing so. And with Louisiana electing its first Democratic governor in over a decade last month, Obamacare supporters could be chipping away at what's been a strong resistance in the conservative South.

The idea behind Medicaid expansion, which lets people earning up to 138 percent of the federal poverty level get government-sponsored health care, is to close the coverage gap. People who earn a little bit more than the cutoff of the federal poverty level often don't have jobs that give them health insurance and can't afford a private plan. Giving them coverage, supporters say, makes them less likely to use the emergency room and other expensive drivers of health-care costs. Opponents, however, argue that Medicaid expansion would drive up already high health costs and is an example of federal overreach. 

Speaking about Republicans' fight against Obamacare last month, Bentley appears to have given up.

“We lost folks. We lost. And we lost in court. So what we have to do now is move past that, take the resources we have available and try to improve the quality of life for the people of Alabama, and that's exactly what I'm going to do."

But Jim Carnes, the policy director at Alabama Arise, a nonprofit focused on policy research for low-income people, assumed Bentley would eventually accept Medicaid expansion on his own terms.

“He fought really hard against Obamacare, don’t get me wrong," he said. "But he’s a doctor who has to think about his legacy."

Medicaid expansion also looks imminent in Louisiana, where Gov.-elect John Bel Edwards says it's one of his highest priorities. Even before Louisiana elected the Democrat, his Republican opponent, U.S. Sen. David Vitter, vocalized his willingness to implement some form of Medicaid expansion.

Vitter's consideration of Medicaid reflects the growing number of Republican governors who have expanded Medicaid -- but on their own terms with federal waivers. Arkansas and Iowa, for example, are using federal money to purchase private insurance plans for low-income residents. Indiana got the go-ahead from the feds to lock residents out of their plans if they don't pay premiums. Montana will expand Medicaid starting Jan. 1, but enrollees will have to pay the maximum amount of co-payments and pay premiums equal to 2 percent of their monthly income. 

In an interview with Atlanta magazine last month, Health and Human Services Secretary Sylvia Burwell said it was just a matter of time before all states expanded Medicaid. But it's a little too soon to paint the South blue on health policy.

Kentucky -- a rare example of a red state wholeheartedly embracing Obamacare from the beginning -- recently elected Republican Matt Bevin as governor. Bevin, considered to be far right, made dismantling Medicaid expansion a central talking point during his campaign. Health-care experts, however, are skeptical about his promises.

"Walking back Medicaid expansion is an enourmously difficult process," said Matt Salo, executive director of the National Association of Medicaid Directors. "There are only two states that have ever actually done it because the logistics of messing with the model is much harder than people might think."

In Tennessee, Republican Gov. Bill Haslam backs expanding Medicaid, but his GOP-dominated legislature shot down his proposal twice -- once in February and once in April. He isn't hopeful about it next year either, recently saying that “something will have to change in the state or on the national scene for that to happen. To be frank, I haven’t seen anything that’s (given) me that kind of encouragement."

“What we’re seeing here isn’t necessarily a fight of Democrats vs. Republicans -- it’s a fight between traditional members of the GOP and the Tea Party," said Salo. "GOP governors have already started to come around, but it’s Tea Party legislators that are stunting further expansion."

Tracy Foster
Tracy Foster, of Clinton, Tenn., center, cries after Gov. Bill Haslam's Insure Tennessee proposal was voted down by the Senate Commerce Committee on Tuesday, March 31, 2015, in Nashville, Tenn. Foster is a cancer patient who has no insurance. The proposal to extend health coverage to 280,000 low-income Tennesseans was defeated 6-2. (AP Photo/Mark Humphrey)
Mark Humphrey/AP

Supporters cry after Tennessee Gov. Bill Haslam's plan to expand Medicaid was rejected for the second time this year. (AP/Mark Humphrey)

It's also unlikely that the holdout states will completely embrace Medicaid expansion under the terms of the Obama administration.

“Unless there’s a seismic shift in state politics, you’ll likely see states try something like what Arkansas is doing with the private expansion or Indiana, which allows for people to be locked out if they don’t pay premiums,” said Salo.

For those who have been pushing for Medicaid expansion since the implementation of the Affordable Care Act, any dialogue on the issue is better than none. According to Carnes, Bentley has been warming up to the idea of some form of Medicaid expansion throughout the past year. “I’m confident Alabama will expand Medicaid in some form during 2016,” he said.

“There’s a regional sense of skepticism, we’ve historically been slower to adapt to change,” Carnes said. “But once a deep Southern state crosses that line, it’ll only be a matter of time before the other holdouts give in as well.”

Mattie covers all things health for Governing.

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