Governors' concerns continue to surface about health law's Medicaid expansion

Though much of the dust-up following the Supreme Court's Medicaid decision has come from Republican governors vowing to opt out of the expansion, news outlets report that some Democratic governors also have concerns. Meanwhile, Kentucky became the 13th state to say it would set up its own online insurance exchange where individuals and small businesses could shop for coverage beginning in 2014.

The New York Times: Lines Are Drawn Over Opting Out Of Medicaid Plan
In the weeks since the Supreme Court ruled that states could opt out of a plan to vastly expand Medicaid under President Obama's health care law, several Republican governors have vowed to do just that, attacking the expansion as a budget-busting federal power grab (Goodnough, 7/12).

The Washington Post: Medicaid Expansion A Tough Sell To Governors Of Both Parties
While the resistance of Republican governors has dominated the debate over the health-care law following last month's Supreme Court decision to uphold it, a number of Democratic governors are also quietly voicing concerns about a key provision to expand coverage (Aizenman and Tumulty, 7/12).

Stateline.org/McClatchy Newspapers: For Some States, Medicaid Expansion May Be A Tough Fiscal Call
Even those governors who eventually accepted the stimulus money may be wary of participating in the expansion of Medicaid, the jointly funded federal-state health care program for low-income people. The federal government currently pays 50 percent to 80 percent of the cost of Medicaid coverage in each state, with the poorest states getting the largest proportion of federal money. But many of the states that would qualify for the highest federal match already leave federal money on the table by maintaining Medicaid programs that are more restrictive than they have to be (Vestal, 7/12).

USA Today: Health Law Ruling Reveals Governors' Split
A 50-state survey by USA TODAY shows only Republican governors are refusing to expand Medicaid and only Democrats are vowing to expand it following the court's ruling that states cannot be penalized for failing to enlarge the program. More than half the governors are undecided (Wolf, 7/12).

Politico Pro: DSH Could Incentivize Medicaid Expansion
If you think the Supreme Court ruling means HHS can't cut states' health care funding, think again. The Affordable Care Act calls for an $18.1 billion cut to federal payments for free or poorly compensated care that hospitals provide to uninsured and Medicaid patients, the idea being that there won't be so many uninsured after the coverage expansions. And how HHS decides to apply the so-called Disproportionate Share Hospital cuts is of great interest to states and hospitals -; especially if they're used in a way that hits harder in states that don't expand Medicaid.  "Do the DSH reductions hit everyone? You bet they do," said Matt Salo, executive director of the National Association of Medicaid Directors. He cited the letter from HHS Secretary Kathleen Sebelius to governors this week as a strong indication that HHS would proceed with the DSH cuts and all other provisions not explicitly addressed by the court (Norman, 7/13).

The Hill: House Dem: Refusing Medicaid Dollars A 'Historic Mistake'
A House Democrat warned Virginia Gov. Bob McDonnell (R) that refusing the healthcare reform law's Medicaid expansion will be a "costly and historic mistake." The Supreme Court's decision to uphold the law has touched off a fiercely partisan debate over whether to expand Medicaid. Many GOP governors have said they will refuse federal funds to expand the program because they worry that financial obligations to future beneficiaries will be too great. Among the governors threatening to do this is McDonnell, a possible vice presidential candidate for the GOP. In a letter, Rep. Gerry Connolly (D-Va.) urged him to not to let the opportunity pass. "The choice we face as Virginia's leaders is momentous," he wrote. "Will we allow this once-in-a-lifetime opportunity to leverage billions of dollars of federal funds to help Virginia's families, businesses, and bottom line" (Viebeck, 7/12)?

Here's how the story is taking shape on the state level -

Kaiser Health News: Maine's Efforts To Pare Medicaid May Put It On Collision Course With Administration
In what is shaping up as the first state-federal showdown on Medicaid following the Supreme Court's ruling on President Barack Obama's health law, Maine is moving ahead with plans to cut about 38,000 people from its rolls to balance its state budget" (Galewitz,7/12). 

Houston Chronicle: State Sharply Lowers Estimate Of Medicaid Expansion Cost
On the heels of Gov. Rick Perry's declaration that Texas will not expand Medicaid because it is too costly, his health and human services commissioner said Thursday that fully implementing health care reform would cost the state about $11 billion less over 10 years than previously estimated. Executive Commissioner Thomas Suehs told a Texas House subcommittee that the new estimate is between $15 billion and $16 billion in state costs over a decade, compared to the previous estimate of $26 billion to $27 billion. The state would get an additional $100.1 billion in federal money over that time, according to the Texas Health and Human Services Commission - money that Suehs acknowledged would be attractive to local entities grappling with the cost of caring for the quarter of the state's population that currently is uninsured (Fikac, 7/13).

McClatchy Newspapers: Alaska Gov. Sean Parnell Might Reject Medicaid Expansion
Alaska Gov. Sean Parnell is expressing "serious concerns" about letting the federal government pay for medical care of more than 30,000 lower-income Alaskans, saying it would also result in state costs he's hesitant to take on. Parnell refused requests for an interview this week. But he provided a written statement in which he laid out reservations with allowing the Medicaid expansion in the federal health care law. The U.S. Supreme Court upheld most of the law last month but said the states have a choice on the expansion of Medicaid eligibility to anyone with an income up to 133 percent of the poverty level, among the major parts of the law (Cockerham, 7/12).

Richmond Times-Dispatch: Bolling Opposes Expansion Of Medicaid In Virginia
Lt. Gov. Bill Bolling on Thursday said he opposes the expansion of Medicaid in Virginia under the federal health care overhaul. Bolling heads GOP presidential nominee Mitt Romney's Virginia campaign. He is vying with Attorney General Ken Cuccinelli for the 2013 GOP nomination for governor (Cain, 7/13).

Texas Tribune: State Medicaid Chief Weighs In On Health Reform
Though Texas will not expand its Medicaid program, the Supreme Court decision to uphold the Affordable Care Act will put a strain on the state's finances and health care system, Billy Millwee, the state's outgoing Medicaid chief, said in a panel discussion on Thursday. … He is among the first senior officials at the Texas Health and Human Services Commission to weigh in on the decision (Luthra, 7/12).

Meanwhile, on the subject of state-based health exchanges -

Los Angeles Times: Kentucky To Implement Key Part Of Obama's Healthcare Law
As right-leaning states such as Texas and Florida redouble their opposition to President Obama's healthcare law in the wake of last month's Supreme Court decision, Kentucky is joining the list of states that will establish its own insurance exchange in 2014, implementing a central pillar of the Affordable Care Act (Levey, 7/12).

The Hill: Kentucky Says It Will Implement Central Piece Of Obama's Health Law
Kentucky will set up its own insurance exchange rather than allow the federal government to take the lead -; the 13th state to commit to an exchange since the Supreme Court's healthcare ruling. Gov. Steve Beshear (D) said in a letter to Health and Human Services Secretary Kathleen Sebelius that he will sign an executive order to create an exchange. Beshear's letter bucks a trend of solidly red states rejecting the Affordable Care Act. Some conservative governors have staunchly refused to set up exchanges, even though that decision ultimately gives the federal government more power over their states' healthcare systems (Baker, 7/12).

Politico Pro: Kentucky Moves Ahead With Exchange
Kentucky is the latest state to tell HHS that it plans to run its own health insurance exchange. With Senate Minority Leader Mitch McConnell and Sen. Rand Paul in Kentucky's delegation, the state may not seem like the most obvious place for an exchange to take root. It hasn't passed legislation to get one going, nor has the governor taken executive action to establish one. But that's all about to change soon. Democratic Kentucky Gov. Steve Beshear, who said he had been waiting on the Supreme Court ruling before moving forward, has told HHS Secretary Kathleen Sebelius that he will "soon" issue an executive order to create the state's exchange (Millman, 7/12).

The Associated Press: Ky. Guv Tells Feds He's Creating Health Exchange
Gov. Steve Beshear has alerted the federal government of his intention to create a statewide health insurance exchange to help Kentuckians find affordable coverage. The Democratic governor sent a letter this week to Health and Human Services Secretary Kathleen Sebelius informing her of his plan (7/12).