Governor’s race could have dramatic effects on Medicaid expansion in Louisiana

Oct. 26--At a debate during the primary election for governor last month, Eddie Rispone was asked for a yes-or-no answer to whether he would roll back Medicaid expansion, which gives nearly half a million Louisiana adults health insurance. After some hesitation and prodding from the moderator, he said no.

But while he isn't advocating a complete rollback of the insurance program, Rispone has staked out a position that stands in contrast with that of Gov. John Bel Edwards, the Democratic incumbent who is campaigning in no small part on his expansion of Medicaid.

If elected, the Republican businessman and longtime GOP donor vows to "freeze" enrollment for Medicaid expansion while he roots out what he calls waste and fraud in the program. He also calls the program "unsustainable," suggesting he would alter it in some fashion.

Like many policy positions, Rispone has not publicly revealed the details of his plan -- for instance, how long a freeze would be in place, or how he would make it more sustainable.

Depending on the specifics, his position on Medicaid could lead to fewer people having access to the government-financed insurance program, a point Edwards has sought to highlight as a key distinction between the two.

Under an enrollment freeze, people who lose their coverage -- a common occurrence for people who pick up extra shifts or seasonal work to boost their income -- would no longer have access to health coverage if their income fell back below 138% of the federal poverty line, which equals $17,244 a year for an individual or $35,544 for a family of four.

If kept in place long-term, a freeze would slowly whittle away enrollment as people drop off the program and are unable to return to it.

Rispone, like many of Louisiana's Republicans, is walking a fine line.

Medicaid expansion gave around half a million Louisiana residents free health coverage and remains popular among voters across the ideological spectrum. Support for Medicaid expansion stood at 72% in the latest Louisiana Survey conducted by LSU's Public Policy Research Lab, including majorities of Republicans and independents.

Instead of calling for an end to the program, Rispone has assailed its implementation and called for changes to how it is run. His tactics line up with how the Republican party in Louisiana has approached Medicaid expansion more broadly, holding up critical audits of the program done by Legislative Auditor Daryl Purpera, and avoiding calls to repeal expansion.

Edwards and his allies argue that while Rispone isn't calling for an outright end of Medicaid expansion, his position would amount to a "de facto repeal" of the program.

"He may try to be phony and call it a freeze," Edwards said at a press conference where he ridiculed Rispone's position. "But we know what Eddie Rispone's plan to repeal Medicaid expansion would do. It would be an unmitigated disaster."

Edwards' campaign on Friday rolled out a new TV ad where a cancer survivor delivers a testimonial about Medicaid expansion, saying it saved her from choosing between cancer treatment and going bankrupt. The ad also hammered Rispone's plan, with the woman ending the spot by saying, "You may not have to vote like your life depends on it, but know that someone does."

Rispone's campaign responded to Edwards' barbs with an unattributed statement that pointed to a legislative audit released about a year ago that calculated that the state might have spent as much as $85 million over 20 months for enrollees who could have been deemed ineligible. Around the same time, LDH implemented a new automated eligibility system that has led to tens of thousands of people losing coverage after quarterly wage checks found they may have made too much to qualify for the program.

Edwards' administration argues the new system is addressing any issues with ineligible enrollees, while Republicans have taken aim at the health department over the findings, questioning whether it is doing enough to police the program.

Anthony Ramirez, a spokesman for Rispone's campaign, said the goal of a freeze is not to kick people off the rolls, but he also did not say how long a freeze would stay in place, or what specific changes a Rispone administration would make to Medicaid expansion in the meantime. Ramirez said Rispone's goal is to make sure the state is protected if the Medicaid expansion funding formula changes at the federal level.

The campaign declined to make Rispone available to discuss Medicaid for this story.

Both supporters and opponents of Medicaid expansion have pointed to Arizona when considering what a freeze of enrollment in Louisiana could look like.

In 2011, Arizona froze enrollment for childless adults in an effort to cut costs amid budget problems. The number of childless adults covered under Medicaid, a population similar to Louisiana's expansion population, dropped by nearly 70% after two and a half years, as people were locked out of the program after their incomes rose or they missed deadlines for turning in paperwork.

The Pelican Institute for Public Policy, a conservative think tank that has railed against Medicaid expansion in Louisiana, advocates a freeze of enrollment as a way to "unwind expansion." Daniel Erspamer, CEO of the Pelican Institute, said Arizona's experience makes it clear "a freeze will drop enrollment in the program, thus lowering the burden on Louisiana taxpayers."

Erspamer advocates a widespread overhaul of Louisiana's Medicaid program, and said doing so would save money and root out what he sees as an "enormous amount of waste" in the program.

The left-leaning Louisiana Budget Project highlighted Arizona as a cautionary tale for freezing Medicaid enrollment, calling the drop in enrollment "disastrous." The group also pointed to Ohio, where Republican Gov. John Kasich recently vetoed a bill that would have frozen Medicaid expansion enrollment over concerns it would jeopardize coverage for half a million residents.

"A Medicaid enrollment freeze amounts to a de facto repeal of expansion, would put untenable pressure on the state budget and take Louisiana in the wrong direction," LBP Executive Director Jan Moller wrote.

Medicaid expansion plays an outsized role in Louisiana's health care landscape because of the relatively large share of residents who earn too little money to afford health insurance, and whose employers don't offer coverage. Once projected to cover more than 300,000, Medicaid expansion peaked at 505,000 in April. As of Oct. 1, it covered about 467,000 people, after a new stricter eligibility system began removing people from the rolls automatically. The expansion has led to a dramatic drop in the rate of people uninsured in Louisiana.

Louisiana's new eligibility system checks the wages of enrollees every three months. If the system identifies people who appear to make too much money to qualify, LDH sends a letter seeking information and warning they will be removed from the rolls. Through the first two wage checks this year, the program removed nearly 50,000 people from the rolls, mostly because they didn't respond to requests for information.

However, the health department also decided the system was too stringent in some cases. Amid a backlog of paperwork, LDH recently suspended a feature that automatically boots people from the program if they don't respond to requests for annual renewal information. The agency resumed those closures for some people, but is now manually reviewing the cases of more vulnerable populations, like people in nursing homes.

To freeze enrollment, Louisiana would need to get permission from the federal government. LDH's Medicaid Director Jen Steele noted Utah tried to get permission for the favorable funding match rate for a limited expansion of Medicaid but was rejected by the Trump administration's CMS. She suggested a freeze here would run into a similar problem -- the state would have to forfeit its better match rate to do so, costing the state hundreds of millions of dollars.

Medicaid expansion, which was authorized by former President Barack Obama's signature health law, the Affordable Care Act, is funded differently than Medicaid generally. Where the broader program is funded with 66.4% federal dollars and 33.6% state dollars, the backers of the ACA designed Medicaid expansion to be far more favorable to states, in an effort to entice them to take part.

That means Louisiana, like the other 36 states that have expanded Medicaid, only pays for about 7% of the program currently. In January, the rate will go to 90% federal, 10% state funding, where it is scheduled to remain.

Medicaid, including expansion, comprises about $13.8 billion of the state's $31 billion budget, with the vast majority, about $10.2 billion, coming from federal dollars.

Currently, Louisiana's share of Medicaid expansion comes primarily from fees on providers and taxes on premiums paid to the private companies that manage care for Medicaid enrollees. State general fund dollars, which are spent on things like colleges and other priorities, are not used to pay for Medicaid expansion.

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