House Health Committee chair sees Medicaid expansion as a possibility

The chairman of the House Health Committee today said that proposed Medicaid reforms could position Alabama to expand Medicaid and accept billions of federal dollars that would accompany an expansion.

“I can see in the future if we can get a grip on this program and get it under control, I can see we can accommodate additional recipients in the Medicaid program,” said Rep. Jim McClendon, R-Springville.

McClendon made his comments after a joint House-Senate public hearing on SB 340 by Sen. Greg Reed, R-Jasper. SB 340 would reform Medicaid and authorize up to eight Medicaid service areas to provide managed patient care. The committee did not vote.

Governor Robert Bentley said he opposes expanding Medicaid in its current fee-for-service form. He has not said if he would agree to expand Medicaid if it is reconfigured into a fiscally responsible system.

McClendon described the conditions under which Medicaid could expand. “I would say if we can get a grip on Medicaid it would be worth reconsidering for all of us, the governor, and legislature, and taxpayers, too,” he said.

The Business Council of Alabama supports Medicaid reform in order to control costs and ensure long-term sustainability. The BCA supports improving efficiency, addressing fraud and abuse, and ensuring access to quality health care.

Medicaid, a combined state-federal medical program, serves about 938,000 Alabamians. The Legislature appropriates one-third of the entire $1.7 billion General Fund to Medicaid. Its financial need grows by about $100 million a year.

Expanding Medicaid could result in 250,000 new recipients and an additional $1 billion a year in federal spending for Alabama, according to a study by researchers at the University of Alabama at Birmingham.

“That billion a year is a tremendous economic incentive to a state that is notably business friendly and to add to that the additional stimulus, those additional jobs, those facilities, that income, it definitely would not be anything but positive on the overall economy,” McClendon said.

Success of a reformed Medicaid would depend heavily on passage of HB 371 by Rep. Greg Wren, R-Montgomery, and whether the Centers for Medicare and Medicaid Services allows Alabama to increase Medicaid recipient co-payments for health care. HB 371 and two other Medicaid-related bills by Wren, HBs 370  and 372, were referred out of committee last week.

Without revisions to Medicaid, legislators fear expansion will bankrupt the budget. “Under the current conditions we’re not in a position try to deal with any more patients,” McClendon said.

McClendon and Reed conducted a public hearing today on Reed’s bill that should start moving after legislators return from their spring break the week after next. “We know we have a system that needs to be improved,” Reed said. McClendon said he will introduce a House version.

State Health Officer Dr. Don Williamson, who is Bentley’s point-person on Medicaid, said supporters include, besides the BCA, the Alabama Nursing Home Association, the Alabama Hospital Association, and the Medical Association of the State of Alabama. Citizen advocacy organizations such as Alabama Arise support positive Medicaid revisions.

Williamson said the bill would create a new Medicaid system of managed care by regional care organizations or alternate care providers in no more than eight geographic regions. Each region would have to be capable of supporting at least two regional care organizations or alternate care providers.

Bentley created a Medicaid Advisory Commission last year. Last week he accepted the commission’s  nine recommendations. The commission recommends dividing Alabama into service regions with regional care networks that would contract with commercial managed care organizations.

McClendon said patient care is of paramount importance and Medicaid finances need to be fixed.

“Quality service is foremost in every statement that we’ve made,” McClendon said. “The cost of it is growing almost like an infection and we’ve got to do something on getting it under control on behalf of the taxpayers.”

– Dana Beyerle