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GOP governors outline Medicaid changes

Thomas Beaumont
Associated Press

Des Moines, Iowa — Michigan Gov. Rick Snyder is among Republican governors from seven states calling for dramatic changes to Medicaid, which provides insurance to more than 70 million low-income Americans, as they nervously watch President Donald Trump and GOP congressional leaders move to repeal and replace the Obama-era health law.

At the same time, they’re telling Washington: Don’t scrap the Affordable Care Act without a viable alternative.

According to a draft of the proposal obtained by the Associated Press, the governors are urging Congress to adopt an alternative that would change Medicaid from an open-ended federal entitlement to a program designed by each state within a financial limit.

Led by Ohio Gov. John Kasich, a frequent critic of some GOP proposals on health care, the governors plan to present their proposal during their annual meeting in Washington this weekend.

In addition to Snyder and Kasich, the governors are Arizona Gov. Doug Ducey, Tennessee Gov. Bill Haslam, Utah Gov. Gary Herbert, Nevada Gov. Brian Sandoval and Wisconsin Gov. Scott Walker.

At the heart of the document is concern among Republican governors they would bear the consequences if Congress scraps the health care law, shifting costs to the states, and jeopardizing coverage for millions of people who gained it under Obamacare’s expansion.

“We must ensure that people do not have the rug pulled out from under them and are not left without access to care, especially during the transition,” the draft says.

The proposal, if adopted by the Republican Governors Association on Saturday, would be submitted to leaders in the GOP-controlled Congress as House Republicans prepare to unveil their plan.

Kasich met in Washington on Friday with Trump to discuss the plan, and described the president as having “listened very carefully to what I had to say about it.”

The governors represent states that expanded Medicaid despite strong GOP opposition and others that did not. Arizona, Michigan, Nevada and Ohio all agreed to expand Medicaid coverage under the federal law, in return for federal reimbursement to cover uninsured lower-income residents who would not have otherwise qualified. Tennessee, Utah and Wisconsin did not.

According to the Kaiser Family Foundation, Medicaid consumed an average 19 percent of state budgets in 2015, the most current year available, ranging from 7 percent in Utah, to 41 percent in New Hampshire.

The governors’ proposal calls for putting states in charge of the program, but the federal government would continue to pay for most of it.

“Flexibility is necessary to improve Medicaid program performance, but states also need adequate funding within a new financing structure to effectively manage the Medicaid program,” the draft plan said.

It’s far from clear whether House Republicans would accept such a deal. Many congressional Republicans want to rewrite the basic financial contract for Medicaid. Republicans are proposing to limit future federal funding in exchange for allowing states much more leeway to run their programs.

Budget hawks including House Speaker Paul Ryan, R-Wisconsin, support the kind of program flexibility GOP governors are seeking, but chiefly want to spend less on Medicaid.

Despite facing a likely battle, the governors involved in the plan represent states with influential Republican senators.

The plan also seeks an unspecified but “appropriate transition period,” as it could be years for a new system to be enacted.

One of the vexing questions before lawmakers is how an alternative to the seven-year-old law would compensate states to subsidize coverage for Medicaid. The Republican governors come down decidedly against block grants, flat sums with far fewer restrictions than the federal law.

Detroit News Staff Writer Melissa Nann Burke contributed.