States consider joining Medicaid expansion early to take advantage of federal money

Despite budget squeezes, some states are considering expanding Medicaid , due to the new health law. 

Minnesota Public Radio: "Lawmakers passed a bill that would enroll poor Minnesotans early in Medicaid, at a marginal cost of nearly $200 million -- that's above expected costs for treating the poor. … The Governor opposes the shift, nominally because of the extra cost and the state's dire budget straights — although [members of the Democratic-Farmer-Labor party] allege it may also be because the expansion is part of the recent federal health care reform passed by the Democratic-controlled Congress." Lawmakers say the move could give the state more than $1 billion in matching federal dollars and could save as many as 20,000 health care jobs (Nelson, 5/13). 

The Washington Post: D.C. lawmakers are considering a similar move, and have asked the federal government for permission to move 35,000 people from a low-income coverage program called D.C. Healthcare Alliance, which is "funded by city taxpayers"  to the Medicaid program, which is mostly paid for with federal funds. "The city expects to save $56 million over four years by expanding Medicaid coverage to include low-income adults who cannot not afford private insurance but earn too much to qualify for Medicaid under the old rules." The Alliance program "would still cover about 15,000 who don't qualify for Medicaid because officials suspect they are illegal immigrants" (Fears, 5/14). 

NPR/KQED: In California, Gov. Arnold Schwarzenegger has plans to submit a revised budget plan, with likely deep cuts to health programs, on Friday (Myers and Montagne, 5/14).

Reuters: The budget hole Schwarzenegger needs to fill is at least $20 billion. "Health and welfare programs are expected to bear the brunt of cuts, teachers are expected to lose jobs and cities are seen being forced to hand over revenue. Schwarzenegger has ruled out tax increases urged by Democrats who control the legislature." The governor has called his health cuts "draconian" and "will unveil revisions for his spending plan and the shortfall on Friday afternoon at 4 p.m." (5/14).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.