Just a few years ago, former Gov. Robert Bentley chose not to accept federal funding to expand Medicaid, but the incentive to do so may now be crossing political lines.
U.S. Sen. Doug Jones, D-Ala., announced Wednesday that he is co-sponsoring a bill, the States Achieve Medicaid Expansion (SAME) Act of 2019, that would ensure states that chose to expand Medicaid after 2014 are eligible for the same level of federal matching funds as states which expanded Medicaid earlier.
Alabama, along with 13 other states, has yet to expand Medicaid.
Medicaid is a joint federal and state insurance program that covers medical costs for eligible low-income Americans. In 2010, states were given the option to expand their Medicaid programs to cover people who earn up to 138 percent of the federal poverty level. Under this deal, the federal government would cover the full cost of the expansion for the first three years, and gradually step down to cover 90 percent permanently.
Jones said for years, leaders at Alabama’s rural hospitals have been warning public officials about the financial cliff they are facing, in large part as a result of the state’s refusal to expand Medicaid. Since 2011, 13 hospitals have closed in Alabama, and seven of those hospitals have been in rural areas.
Approximately 88 percent of rural Alabama hospitals are operating in the red. The Alabama Hospital Association estimates that some 326,000 Alabamians would gain health care coverage if Medicaid was expanded in the state, Jones added.
“By refusing to expand Medicaid, Alabama has turned away $14 billion of our own taxpayer dollars. For years, those dollars could have helped keep our hospitals open, support good jobs in our communities, and provide health coverage for hundreds of thousands of Alabamians. This isn’t a partisan issue – expanding Medicaid is the right thing to do,” Jones said. “Alabama can no longer afford not to expand, and our SAME Act legislation would ensure that states will get a fair deal when they do. I urge my colleagues on both sides of the aisle, and on both sides of Capitol Hill, to support this common sense bill.”
State Rep. Randall Shedd, R-Fairview, said there have been meetings across the state concerning the plight of hospitals and how Medicaid expansion would play into their financial health.
“Even before news of the bill in the Senate, there has been an effort by my party to look at the merits,” Shedd said. “I think there is a new look at Medicaid expansion, and maybe that Gov. Bentley didn’t make the right decision. We can’t let rural hospitals continue to close. I read a report recently that the states that have expanded Medicaid have not had any hospitals close.”
Shedd said there is also concern about the level of reimbursement that hospitals and health care providers receive from Medicaid.
“For some reason it is lower here than in some other states, so that is something that has to be addressed,” Shedd said. “If Medicaid is expanded and includes coverage for more people, there has to be a look at the reimbursement rate.”
The SAME Act would ensure that any states that choose to expand Medicaid get a second chance to receive these same levels of federal funding. Under this bill, a state would receive three years of full federal funding, phasing down to a 95 percent Federal Medical Assistance Percentages (FMAP) in year four; a 94 percent federal contribution in year five; 93 percent in year six; and, 90 percent for each year thereafter.
Alabama alone would receive $2 billion in federal dollars the first year after expansion, according to information provided by Sen. Jones’ office.
David Palmer may be contacted at 256-734-2131, ext. 116.