Governor, lawmakers to decide Medicaid expansion for low-income Nevadans

By Anjeanette Damon (contact) , David McGrath Schwartz

Published Thursday, June 28, 2012 | 11:33 a.m.

Updated Thursday, June 28, 2012 | 2:30 p.m.

The U.S. Supreme Court handed states at least one victory in its landmark ruling on the federal health care law: The ability to reject a significant expansion of Medicaid coverage to low income people.

Now, the battle begins over whether Nevada should expand the program—a move that could cost the state millions of dollars, but give thousands of low income Nevadans an affordable way to comply with the mandate to carry insurance.

"This shifts the fight to the governor and Nevada Legislature," said Jon Sasser, statewide advocacy coordinator for state legal services agencies.

While upholding the mandate for most Americans to get health insurance, the U.S. Supreme Court found that the federal government can't compel states to expand Medicaid eligibility - one of the key ways that a bulk of poorer Americans would receive health care under the Affordable Care Act.

About 91,000 additional people - including the poor without dependent children and those waiting to qualify for federal disability benefits - would be covered under the expanded operation.

Congress included the Medicaid expansion as a way to blunt the burden on poorer Americans who might not be able to afford the individual mandate to carry health insurance.

But Gov. Brian Sandoval and Republicans have worried about the costs to the state, though the potential price tag for the expansion isn’t immediately was unclear.

“I guess my answer would be I would hope that Nevada does not have to expand in any larger way than necessary our participation in Medicaid because simply it’s a very challenging proposition,” Assembly Minority Leader Pat Hickey, R-Reno, said.

Assembly Majority Leader Marcus Conklin, D-Las Vegas, said lawmakers are still reviewing the court opinion and the details of what an expansion would mean.

Decisions on the Medicaid program, which is for the poor and disabled, rests with the executive branch - the governor. The Legislature does allocate money for any expansions.

Sandoval's statement on the Affordable Care Act, released this morning, does not directly say whether Sandoval will go along with the Medicaid expansion.

"The implications for Medicaid costs are still unclear, but Nevada will prepare to meet the serious financial implications of this decision," he said.

Sandoval went a bit further Thursday morning in an interview on Nevada Newsmakers, saying Nevada can't afford to expand Medicaid.

"To opt in I would have to look at cutting education and at other, what I think, are untenable outcomes," Sandoval said. "As I sit here today, it wouldn't be my intention to opt in."

In a press conference following the court opinion, Sen. Harry Reid warned governors against opting out of the Medicaid expansion.

"I think those governors that are now saying some things, if they continue along saying them, they will wish they hadn’t, because they will not... help their constituents like the states that have," Reid said.

The Legislature could pass a bill compelling the governor to expand Medicaid, but he could simply veto it.

The Affordable Care Act is estimated to cost Nevada about $574 million between 2014 and 2019, most of that in additional Medicaid costs.

But if the state decides not to expand its eligibility, it's unclear how much of that money would be saved. The federal government has promised to pay almost all of the costs of those newly eligible. The additional cost to Nevada comes from those who currently qualify but, for whatever reason, don't participate in the program. The state also must bear the full price tag of administering the program.

"In my opinion, it’s a great deal for the state," Sasser said. "There's not any real rational reason for not doing this, other than some sort of political decision."

Sandoval isn't ready to jump at the deal, though. His administration estimated Medicaid costs will begin to swell as soon as next year. By the end of 2014, Sandoval's office estimates as many as 141,000 new people-- including 20,000 children-- will seek health coverage through the state.

"These serious budgetary implications, including the impact on education spending, require further analysis – not just of the next biennial budget but of the long-term costs," his spokeswoman Mary-Sarah Kinner said in a written statement. "Further information will be provided as the budgeting process unfolds over the next few months."

Assemblywoman Debbie Smith, D-Sparks, said she has asked legislative staff to research the legal and fiscal ramification of the opinion for a presentation to an interim committee in August.

"Personally, I want to see more people with coverage, and, yes, more people need to have access to health care," she said. "But I need to know what my options are here. What are the different options within the ruling?"

Smith and Conklin pointed out that Nevada has already begun work to set up a health insurance exchange, where uninsured can shop for insurance plans once the law is fully implemented. She said she hopes there are affordable plans available from that exchange that might take some of the burden off of the state budget.