Politics & Government
9:55 am
Thu June 13, 2013

Medicaid: Compromise At Last?

Lessenberry commentary for 6/13/2013

Several months ago, the federal government offered the states, including Michigan, a deal that sounded almost too good to be true. Washington offered to expand Medicaid coverage to citizens earning up to a third more than the official poverty level.

We aren’t talking rich people. Currently, poverty is officially defined as an annual income of $23,550 for a family of four. Those making that amount or less are eligible for Medicaid. But with the requirement that people buy health insurance about to kick in, Washington offered to increase eligibility to a family making as much as $31,300 a year. This is a figure that changes with inflation, and which varies based on family size.

What would that mean for Michigan? Well, within a few years, nearly half a million people who now have no health care would be covered. Initially the state would pay nothing.

After three years, there would be some minimal cost, but these would be capped at ten percent. That would be far less, economists say, than the cost now passed on when poor folks use hospital emergency rooms as their only care provider.

This sounded like a win-win situation for everybody. But for weeks, it seemed as if it had no chance of being passed. That’s because many legislative Republicans remain ideologically opposed to expanding any kind of government health care.

They even refused Governor Snyder’s pleas to create an exchange to help people find private health care plans under the Affordable Care Act.  Eventually, Republicans said they might accept expanding Medicaid with the condition that people only be eligible for four years, much as the rules they’ve imposed on welfare.

But it was clear that Washington would reject that plan. Medicaid expansion sounded like yet another opportunity lost.  However, during the Mackinac conference I got wind that a possible compromise might be in the works, and now it may be about to pass the Michigan House of Representatives.

If passed, the bill, sponsored by a Republican named Matt Lori, would indeed require those who make between poverty level and the higher figure to pay a fee for their Medicaid coverage -- or buy insurance elsewhere -- after four years.

This compromise doesn’t please everyone, by a long shot. Democrats aren’t happy with the idea that people who are still anything but well off will eventually have to pay some out-of-pocket costs. Hard-line Republicans want no expansion of federal health care, no matter how much good it does or money it saves.

But as of now, it looks like this may, repeat may, pass both houses, perhaps with solid Democratic support and a minority of the majority Republicans. What we just don’t know, is whether Washington will agree to allow Michigan to impose the fee. That would take a special waiver. Nor does anyone have any idea how collecting such a fee would work. In any event, the fee wouldn’t kick in till most of today’s lawmakers are gone.

But if this works, it will be a sign that creative compromise may still be possible.  And to me, that is a very hopeful thing.

Jack Lessenberry is Michigan Radio's Political Analyst.  Views expressed in the essays by Jack Lessenberry are his own and do not necessarily reflect those of Michigan Radio, its management, or the station licensee, the University of Michigan.