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Medicaid Expansion Budget Before Governor, But Looking Good

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West Virginia's Medicaid program as a percentage of the state's GDP. Chart from the WV Center on Budget & Policy.
West Virginia's Medicaid program as a percentage of the state's GDP. Chart from the WV Center on Budget & Policy.
April 15, 2013

CHARLESTON, W.Va. - With the legislative session over, Gov. Earl Ray Tomblin is expected to announce whether the state will expand Medicaid as offered under Obamacare. Advocates say expansion would not be hard on West Virginia's state budget. The federal government would pay the full cost of expansion for three years and no less than 90 percent after that. Critics have warned the feds might not keep that promise, leaving the state on the hook.

However, Perry Bryant, executive director, West Virginians for Affordable Healthcare, said the White House fought to protect the program's funding in the recent budget battles.

"I think it shows you the commitment that President Obama is making to Medicaid, to make sure the governors know that as long as he's president the contribution that they've made to states in the Affordable Care Act is going to be upheld," he said.

The state budget will actually benefit from the economic activity sparked by $700 million in new federal Medicaid money, Bryant said. They estimate the new funding will mean 6,200 additional jobs by 2016, he added, and that will filter through to new revenue for the state, offsetting some of what expansion will cost.

"More nurses, more doctors," Bryant said. "They go to restaurants. They buy cars. All that generates economic activity. Clearly it will offset. Whether it will totally compensate for it or not, we don't know. "

One option being considered in Arkansas would give the new Medicaid patients vouchers to buy private insurance in the newly open insurance exchange. That would increase the reimbursement rates for doctors, Bryant said, meaning more providers would accept Medicaid, but it could cost the state more to cover the same patients, he warned.

"Increase reimbursements, you provide them the same benefits, you need to pay these insurance companies for providing those services," he said. "How you end up making that budget neutral, I just don't know."

Expanding Medicaid up to one and one-third times the poverty line would cover more than 100,000 low-income West Virginians. Critics have most often cited budget issues as their chief reservation.

Dan Heyman, Public News Service - WV