Nixon open to GOP Medicaid proposals

JEFFERSON CITY, Mo. -- Missouri Gov. Jay Nixon on Wednesday embraced many of the market-based Medicaid changes sought by GOP lawmakers after an unusual closed-door meeting between the Democratic governor and more than 100 House Republicans.

Nixon described his more than 45-minute-long meeting with the House Republican caucus as "a solid and productive discussion" about ways to expand Medicaid coverage to more low-income adults under the provisions of President Barack Obama's health-care law.

He emerged slightly more optimistic that the Republican-led Legislature, which has repeatedly rejected a Medicaid expansion, could still pass a bill before the session ends in mid-May. But Nixon acknowledged: "We've got a lot of work to do."

The meeting came hours before a House committee was to vote Wednesday on a Republican alternative to Nixon's proposed Medicaid expansion that would cover fewer new adults, drop Medicaid benefits for some children and inject more of a private-sector insurance model into the Medicaid system.

Rep. Jay Barnes, a Jefferson City attorney sponsoring the Republican alternative, said Nixon's meeting came too late to result in immediate changes. Barnes described the discussion as "open and honest" but declined to go into details.

Current coverage

The joint federal and state Medicaid program already covers about 880,000 people in Missouri -- about one in every seven residents. Coverage is available to children whose families earn three times the poverty level, about $58,600 annually for a single mother of two. Yet that mom cannot get Medicaid coverage for herself unless her income is less than about $3,700 annually. Adults aren't eligible at all in Missouri unless they have children, a disability or are retirement age.

The 2010 federal health-care law called for states to extend coverage to adults earning up to 138 percent of the poverty level, about $27,000 annually for a family of three. States that do so can get full funding for the first three years, starting in 2014, then an amount that gradually decreases to 90 percent federal funding by 2020.

Barnes' plan would expand adult Medicaid eligibility only to the poverty level, which Obama's administration's has said is not sufficient to trigger full federal funding. Nixon said he told Republican lawmakers Missouri's plan must cover adults up to 138 percent of poverty, but he said there are ways to do so besides a straightforward Medicaid expansion.

"There are some market-based reforms that can involve private insurance," said Nixon, referencing an Arkansas plan that would use federal Medicaid money to buy policies for people through a new online insurance marketplace.

Barnes' legislation would require the state to seek competitive bids from private insurers to offer managed-care policies to Medicaid recipients. Enrollees would have to make co-payments for medical services and could get cash incentives for holding down their health-care costs -- for example, by avoiding hospital emergency rooms for routine problems that could be treated by a primary-care physician.

Nixon said he's open to Medicaid changes that require more "personal responsibility" and cash from participants, more competition among insurance plans and that seek to lower costs through better coordination of care. He also said Medicaid should be structured like a ladder, not a cliff, so people don't immediately lose eligibility as their incomes rise.

The governor said his discussion with Republicans did not address part of Barnes' plan that would remove Medicaid eligibility for some children whose parents earn up to three times the poverty level and have access to other insurance. Nixon told reporters he wants to make sure children are covered.

The governor used a fairy tale analogy to describe prospects of passing a Medicaid bill after Wednesday's meeting.

"Under the three bears' analysis, the porridge is a little warmer," Nixon said. But "we've got a lot of work to do, and we're a heck of a long way from the finish line."

Senate Majority Leader Ron Richard, R-Joplin, on Wednesday said lawmakers may need to create a special committee to study the issue further before the 2014 legislative session.

"I don't think anything is going to happen this year," he said.

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