Hospital officials muted on Medicaid expansion here

State hospital associations across the Southeast and the nation are stumping hard in favor of expanding their states’ Medicaid program under the Affordable Care Act.

The Georgia Hospital Association is an exception, however.

GHA, in a recent email to Georgia Health News, says it is studying the expansion issue. “We are still in the process of collecting data on the issue,’’ said Kevin Bloye, a GHA vice president. “Hopefully, we’ll be able to offer more on this in the near future.”

A state’s decision to reject Medicaid expansion would hurt a local hospital industry financially, experts say. The 2010 health reform law is expected to cost hospitals billions of dollars by reducing Medicare reimbursements and phasing out federal payments that compensate hospitals for providing free care to the indigent.

Georgia hospitals, for example, are projected to lose $400 million in federal indigent care funds under the Affordable Care Act.

The ACA assumed that most of these uninsured patients would get coverage through an expansion of Medicaid. The U.S. Supreme Court ruled last year, however, that states don’t have to expand Medicaid to cover such people.

And without expansion turning millions of uninsured people into paying patients, hospitals could come out as losers under the law, known colloquially as Obamacare.

About half the states plan to expand their Medicaid programs. If Georgia were to expand Medicaid – which the state’s current Republican leadership says it won’t do – more than 650,000 people would be added to the program’s rolls.

Privately, hospital officials in Georgia say they favor expansion, and two other hospital associations in the state are voicing support as well. But most of the talk about it is behind the scenes. Industry leaders appear to be leery of getting into a political battle right now over expansion.

A recent Stateline report, meanwhile, said hospital associations in other states have paid for television and newspaper ads, organized rallies, and choreographed legislative testimony in support of Medicaid expansion.

Uphill battle in Georgia

The roadblock to Medicaid expansion in Georgia is formidable. Gov. Nathan Deal has remained steadfast in his opposition to it, citing an estimated $4.5 billion cost to the state over 10 years. And his fellow Republicans in the state’s political establishment are not pushing for it.

Deal, who has expressed skepticism about the law’s federal funding guarantees, says Medicaid expansion would prove too costly to the state in any event, adding to the expense of a financially strapped program. He is running for re-election next year.

The Cover Georgia campaign, which pushes for Medicaid expansion, has just one hospital as a member – Grady, the big Atlanta safety net provider.

Expansion would cover people upfront with insurance, rather than the current system of hospitals seeking uncompensated care funds at the end of the process, said Cindy Zeldin, a leader of Cover Georgia and executive director of Georgians for a Healthy Future.

When asked why she thinks the state’s hospital industry isn’t working hard for expansion, Zeldin said, “I don’t know. It doesn’t make a lot of sense to me. We’ve seen hospital associations all across the country engage on this issue.’’

Part of the industry’s reluctance to push expansion may be linked to its huge legislative victory on the provider fee in the recently concluded General Assembly session.

Lawmakers passed a bill that paved the way for renewal of the hospital provider fee mechanism, which is expected to fill a hole of nearly $500 million in the financially squeezed Medicaid budget. In passing the measure, most Republican legislators had to tread carefully to avoid riling the anti-tax movement, a key GOP constituency that wanted the fee killed.

Industry experts say that in the aftermath of the legislation, the hospital industry may be lying low, waiting for federal approval of Georgia’s provider fee plan.

Still, officials with two other hospital organizations, HomeTown Health and the Georgia Alliance of Community Hospitals, each told GHN they support Medicaid expansion.

“We cannot afford not to do this, even knowing that there are so many uncertainties associated with Medicaid expansion,’’ said Jimmy Lewis, CEO of HomeTown Health, an organization of rural hospitals in Georgia.

If the state does not expand Medicaid, Lewis said, “Georgia taxpayers will be subsidizing other states’ expansions.’’

And Julie Windom of the Alliance of Community Hospitals said, “We certainly support expansion, especially given the elimination of [uncompensated care] funds in the ACA.

“We are just cautious about pushing too hard given the stance that state leaders have taken on the issue,’’ she said in an email. “We certainly understand that there are future financial obligations the state will encounter if they do expand.”

Outspokenness in other states

Elsewhere, the Florida hospital industry has aired commercials across the Sunshine State, saying the expansion would improve the health of residents as well as help hospitals, and would create thousands of new jobs. South Carolina’s hospital association trumpets expansion on its website.

Craig Becker, president of the Tennessee Hospital Association, noted that hospitals in his state stand to lose $5.6 billion at a time when 58 facilities, mostly rural, are already losing money every year.

“I can’t wrap my head around those numbers,” he told Modern Healthcare. “This is a tax on hospitals. Why should we send those tax dollars to California, New York or Vermont, or even New Jersey?”

Mississippi hospitals recently backed away  from their call for full Medicaid expansion. But according to Mississippi Public Broadcasting, hospitals there still insist they need something like Medicaid expansion or they will have to cut services or lay off staff.

The projected benefits of Medicaid expansion would include an economic boost for Georgia, a recent report found.

An estimated 70,000 new jobs would be gained if Deal approved expansion of the state’s Medicaid program, according to the report, from Georgia State University’s Bill Custer.

The study also said expansion would produce an economic impact statewide of $8 billion annually.

And a recent article from the progressive-leaning Center for American Progress, citing a  New England Journal of Medicine study on higher mortality rates for the uninsured, said Medicaid expansion could save more than 1,100 lives per year in Georgia.