State lawmakers have to track the federal efforts for health care reform, in large part, because it focuses on Medicaid, the state’s single largest budget challenge.
State Rep. Mike Ball (R-Madison) confirms, “A lot of our decisions with regard to things like Medicaid are dependent on what happens in Washington.”
State Senator Arthur Orr (R-Decatur) also notes,”It will have a direct impact on our state Medicaid program here in Alabama.”
The state has avoided catastrophe in its Medicaid program recently by plugging the hole with funds the state received for the BP oil spill.
However, state lawmakers say one of their big hopes is that the state will receive more flexibility in how they spend Medicaid money. Ball says, “One of the difficulties of managing it on the state level is there is so much bureaucratic red tape that’s tied into Washington.”
Many changes to Medicaid made at the state level need to be approved on the federal level, since the federal government provides most of the money.
Orr, a state budget chair and power broker in the Senate, also wants more leeway.
He says he’s concerned the federal health care reform might be too generous with states that expanded Medicaid. The federal government agreed to match state funds for Medicaid expansion at a 9:1 rate, but Alabama officials said they couldn’t afford the increase to get the matching funds.
Now state officials express concern the states that did put together the money to expand Medicaid with the promise of matching federal dollars will get preferential treatment.
Meanwhile, Orr says he’d like to see more freedom to cut Medicaid, ”We could save over $100 million in state dollars if we were to remove able-bodied adults from our state Medicaid program. Now that’s a greater policy decision. Do you want to do that or not? Or do we require some kind of work component or job training component and say, ‘We’re not going to pay for your health care if you’re able-bodied and you’re not working and you’re not seeking a job and you’re not in a job training program, we’re going to kick you off.’”
Currently those changes would need federal approval, because the federal government still covers most of the program’s funding, even without expansion.
Senator Orr notes, “We’ve got to get a waiver from Washington to do that, but we need to be pushing the envelope in the state to reduce our costs.”
He hopes the state will get new mechanisms for that through federal reform or at least will pursue more waivers from a presumably agreeable Trump administration.
Still, as for the bills being debated in the nation’s capitol, Orr says, “I’ve learned not to be too engrossed in the various scenarios that take place up in Washington, because they change daily and sometimes hourly. So rather than get too fixated on some possibility, rather wait and let the dust settle a bit more.”