Medicaid expansion: Room for compromise?

The door may not be closed on a Georgia Medicaid expansion after all.

Gov. Nathan Deal had appeared to rule out expanding Medicaid while speaking Tuesday to the media in Tampa at the Republican National Convention.

“No, I do not have any intentions of expanding Medicaid,’’ Deal said, according to the AJC. “I think that is something our state cannot afford.’’

Deal spokesman Brian Robinson, though, told the Associated Press, ‘‘Today, the governor said if the state’s only options remain the ones that are available today, he would oppose taking part in the expanded Medicaid program.’’

Robinson, asked by Georgia Health News on Wednesday to clarify his remarks, said in an email that the governor would reassess his expansion decision if Medicaid were changed to a ‘‘block grant’’ approach.

That change, advocated by the GOP vice presidential nominee, Rep. Paul Ryan of Wisconsin, would give a state a lump sum of federal money for Medicaid, while the state would gain more flexibility in deciding how to spend it. A state could then decide whom to cover and what benefits to offer, thus changing the nature of the Medicaid entitlement.

An expansion, as outlined in the Affordable Care Act, would add more than 600,000 Georgians to the Medicaid rolls, starting in 2014. The federal government would pay 100 percent of the costs in the first three years, and 90 percent thereafter, with the state picking up the remaining tab.

A block grant approach, Robinson said, could allow Georgia ‘‘to use the federal portion to expand Medicaid and not have to chip in a state share, which in the governor’s view is unaffordable.’’

Deal has cited a cost estimate of Georgia’s share of the Medicaid expansion under the current format at $4.5 billion over a 10-year period. Medicaid, which covers 1.6 million poor and disabled Georgians, is jointly financed by the state and federal governments.

“If Governor Deal feels like there’s a way for us to get back our share of federal dollars while still protecting Georgia taxpayers, that’s a good start,’’ Robinson said. “We aren’t drawing any lines at this point.”

Since the U.S. Supreme Court ruled in June that states can’t be compelled to expand Medicaid, several GOP governors in the South have rejected expansion: Rick Scott of Florida, Bobby Jindal of Louisiana, Phil Bryant of Mississippi, Nikki Haley of South Carolina and Rick Perry of Texas.

A block grant change would take an act of Congress, said Bill Custer, a Georgia State University health policy expert.

If that were approved, a state could get fewer federal strings to run Medicaid as it saw fit, Custer said. The downside could be the potential for having state taxpayers paying for an increased share of Medicaid costs, he said.

But if a state such as Georgia expands Medicaid under a block grant, officials could look to cut spending by 10 percent and not have to incur its portion of expansion, Custer said. Possible targets of reductions would be to eliminate what the state sees as non-essential benefits for patients, or to reduce payments to medical providers.

Georgia’s Medicaid program, though, currently faces a large shortfall in funding.

The Georgia Hospital Association told GHN on Tuesday that it supports a block grant approach to Medicaid.

Tim Sweeney, director of health policy at the Georgia Budget and Policy Institute, said Wednesday of a block grant change, “It’s difficult to speculate on an alternative that hasn’t been laid out.’’

“The details are very important,’’ especially which parts of Medicaid that Georgia would decide to cut, he said. Under a block grant, Sweeney added, the state would have less revenue for the program than under a full Medicaid expansion as it’s now set up. The state doesn’t adequately fund Medicaid currently, he said.

Deal had indicated in June, after the Supreme Court ruling, that he wanted to wait until after the November elections to make a decision on the expansion, and his comments in Tampa were a surprise.

Whether to expand Medicaid may be Georgia’s biggest decision ever on health care, industry experts have said.

The AJC recently reported that under an expansion, the federal health care law would inject $40 billion into Georgia’s health care economy over 10 years. That money would cycle through the state’s economy and have an overall economic impact of $72 billion between 2014 and 2023, Jeff Humphreys, director of the University of Georgia’s Selig Center for Economic Growth, told the AJC.

The benefits of Medicaid expansion far outweigh the costs to the state, said Cindy Zeldin, executive director of Georgians for a Healthy Future.

“Block grants are not the answer,’’ she said. “They would likely result in reducing eligibility levels, medical benefits, or provider reimbursement rates because they would cap the funds coming into Georgia without regard to the health care needs of Georgia patients and consumers.”