Michigan Senate panel OKs Medicaid bill with two alternatives

A Michigan legislative committee on Wednesday voted to make at least 320,000 low-income adults eligible for Medicaid health insurance in 2014 and beyond, setting the stage for a crucial vote in the Republican-dominated Senate in late August.

The Government Operations Committee also approved two alternative plans backed by conservative senators who oppose expanding the Medicaid program under the federal health care law. The rival bills, though, lack bipartisan support while the revised Medicaid legislation has backing from Democrats along with some Senate Republicans, Gov. Rick Snyder, business groups, insurers and advocates for the poor.

The panel’s chairman, Senate Majority Leader Randy Richardville, acknowledged his decision to advance all three plans is unorthodox but said it’s warranted given the issue is so big and affects so many people. While he strongly supports the Medicaid bill, he said proponents behind the alternative plans deserve a chance to keep pushing the new bills despite critics questioning their cost to the state and patients.

The committee votes came six weeks after the full Senate adjourned without voting on a House-passed Medicaid expansion plan to the dismay of an angry Snyder. The Senate version of Medicaid expansion makes changes but largely keeps intact the guts of the House proposal backed by the Republican governor.

Asked if he will drop his preference that at least half of Senate Republicans be OK with voting on Medicaid expansion, Richardville said: “If I believe it’s the right thing to do, I’ll do that.”

The Monroe Republican intends for the Senate to vote Aug. 27 or 28.

Another committee member, Senate Minority Leader Gretchen Whitmer, criticized the move to bring three plans to the Senate floor, saying it “sends a convoluted message.” Republican Sens. Bruce Caswell of Hillsdale and Patrick Colbeck of Canton Township had their chance but failed to persuade a Senate workgroup to recommend their ideas to the committee, she said.

“We support everything so we stand for nothing,” said Whitmer, an East Lansing Democrat.

The 4-0 vote on Medicaid expansion came at the end of two days of at times passionate testimony, with two Republicans and two Democrats in support and one Republican abstaining. The other two plans were approved 3-2 along party lines.

Medicaid covers roughly one in five Michigan residents, mainly low-income children, pregnant women and disabled people but also some poorer working adults. The legislation, if the federal government signs off, would provide Medicaid to nearly a half-million more adults by 2022, cutting the state’s uninsured nearly in half.

The federal health care overhaul lets states expand Medicaid to adults making up to 133 percent of the poverty level, or $15,500 for an individual and $26,500 for a family of three. The U.S. government is offering to cover the entire cost initially and 90 percent later.

The bill includes requirements that nondisabled enrollees making between 100 and 133 percent of the poverty line pay up to 5 percent of their income on medical expenses. They would have to contribute up to 7 percent after getting Medicaid for four years or shop for insurance from a new marketplace where they could qualify for federal tax credits to help pay for it.

Medicaid recipients could lower their premiums and co-pays if they meet healthy behaviors like not smoking and completing an annual health risk assessment.

The Medicaid expansion would end once cumulative state costs exceed savings that result from shifting state mental health and other to the federal government. The nonpartisan Senate Fiscal Agency estimates the expansion would stop in 2027.

Caswell’s bill would cover adults earning up to 100 percent of the poverty level under a new low-income health plan outside of the Medicaid program, while those earning up to 133 percent could buy subsidized insurance from a federal health exchange. Critics said it would cost the state $500 million in the second year and be unaffordable for recipients, while he said people are distinguishing too much between state and federal dollars when it’s all taxpayers’ money regardless.

Colbeck’s bills would convert Medicaid enrollees to what he said would be a lower-cost, “free market” system with high-deductible plans and direct primary care designed to cut out overhead costs. He and others are concerned that billions of dollars in Medicaid spending is unsustainable.

“They don’t have the money they’re promising us in the Affordable Care Act,” Colbeck said.

Snyder, who has clashed with the Senate over Medicaid expansion, commended the committee for voting.

“This is an opportunity that we can’t pass up. Too many Michigan lives depend on it,” he said in a statement.

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