Special Session of the General Assembly to Begin March 24. 
Why is Healthcare Included in Virginia's Budget?
 
Senator Walter A. Stosch, 12th Senate District 
Co-Chairman, Senate Finance Committee
There are calls to de-couple the budget and the issues surrounding healthcare in the budget debate. Let me share my perspective.

 

The Affordable Care Act (ACA), otherwise known as Obamacare, is tearing our country apart. 56% of the public is now opposed to the ill-conceived and equally ineptly implemented ACA. The Republicans are especially divided on how to best respond nationally and in the states.

 

But, despite my personal opposition to the entire plan, it is the law of the land. That decision was made when my preferred presidential candidate failed to be elected.

 

So, if we now do not have the votes in Washington to repeal it or defund it, at least during the remainder of President Obama's term, how can we make the best of a bad situation?

 

First, some brief facts facing Virginia:

  • Of 8.2 million citizens, almost all (86%) have some form of health insurance available.
  • Of those uninsured in Virginia, about 248,000 make too much to be on Medicaid and too little to be eligible for the new federal insurance exchange, one of many problems created by the federal ACA program. An estimated 30,000 are military veterans.
  • Virginia could recover about $1.7 billion each year of the new federal taxes Virginians will pay into the ACA to expand Medicaid to include this group. The Supreme Court said Medicaid expansion cannot be forced on states and Virginia said no to expansion. Is there a better way which represents a compromise?

Other than simply postpone any decision, two basic approaches remain and are being considered by the General Assembly in the Special Session.

 

As the Speaker of the House of Delegates (a good personal friend with whom I served in the House of Delegates many years ago) is quoted in a recent op-ed in his local Free-Lance Star, "Medicaid expansion is the wrong approach. Instead Virginia should look at alternative ways to help those in the Obamacare coverage gap."

 

I agree. It is therefore a matter of how and when to close the coverage gap, not whether. The debate in the Special Session will center on this question. There is an alternative to expanding Medicaid. That option is to reject Medicaid expansion but get our $1.7 billion back and use it to purchase private managed care insurance on those trapped in the Obamacare gap. This would provide very basic health insurance to a group that we are now paying for twice, once in indigent care and again in new federal taxes.

 

Some say "decouple" the budget debate from the healthcare debate. They say "pass a clean budget." There are several reasons why this should not be done. First, Governor McDonnell included provisions in his budget proposal for recovering federal funding under the Affordable Care Act as early as 2012. So including this debate in the current budget is certainly not new or inappropriate. The budgets just introduced in both the House and Senate (SB/HB30) already contain the following language: "There is hereby appropriated sum sufficient nongeneral funds for such costs as may be incurred to implement coverage for newly eligible individuals pursuant to 42 U.S.C. 1396d(y)(1)[2010] of the Patient Protection and Affordable Care Act."

 

Also included in the current budget for 2013-14 is $195 million in savings from the ACA and $51 million in savings projected in the budget (2015-16) now being debated. Additionally, if the private insurance option is adopted by October 2014, we would be able to budget an added $285 million in indigent care savings in General Funds as well. Add that to what the hospitals and other providers will save with the Senate compromise plan and we are talking about hundreds of millions more.

 

Secondly, a separate bill would be greatly influenced by the Speaker of the House, who has staked out his opposition to the private insurance plan. My House Republican colleagues, who with their majority control outcomes in the House, are expected to closely follow the Speaker's lead. Besides, when a separate bill was considered in the Senate earlier this year, House members pronounced it "dead on arrival" should it be presented to them. So, the private insurance option is unlikely to have much of a chance of consideration without the umbrella of the budget debate and, without the budget, the $285 million in savings over the next two years may be lost.

 

Finally, and most importantly, we do not have enough votes to adopt a budget in Virginia without addressing the healthcare issue. Even if we did, the Governor would veto such a budget. That is how committed the Democrats and the Governor are to Medicaid expansion. This is not an up or down vote on the ACA, Obamacare, Medicaid or the private insurance compromise. It is an up or down vote on our state budget for 2015-2016. The Democrats are now in control of the state Senate and are quite willing to go to whatever lengths necessary to achieve their goal of full Medicaid expansion. We have a narrow window of opportunity to reject expansion and approve a compromise of private insurance in the hopes of avoiding such expansion and to avoid a financial disaster for our children and grandchildren.

 

So that is where we are. If I could repeal, defund or help the Affordable Care Act implode, I would. However, that decision was made north of the Potomac and supported by the majority of voters in the last presidential election, not at the state Capitol. Those who oppose the private insurance plan will call it "Obamacare" or "Medicaid expansion" in an effort to inflame opposition. Those who believe the problem will not go away and must be solved may view a private insurance compromise as a common-sense solution and an alternative to expanding the Medicaid rolls.

 

Regardless of how to best label the solution to the coverage gap, the question remains open for anyone who can provide thoughtful guidance to our legislators as the debate continues. What, in your opinion, can be done differently that would both work and be more fiscally responsible? 

 

Let your Senators and Delegates know how to best deal with this national dilemma when they return to Special Session on March 24th.


Authorized and paid for by Friends of Walter Stosch

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