Idaho health care debate may have turned a corner

It could end up that a state plan for helping poorer Idahoans get to the doctor could accomplish more by stumbling than by succeeding.

Gov. Butch Otter’s plan, part of next year’s proposed state budget, failed its first test of legislative support last week when a bill to pay part of the program’s cost failed to win even a proper committee hearing.

For those who think Idaho can and should do more for the health of its less-well-off citizens than put $32 a month toward doctor’s office visits, it’s not Pollyanna-ish to say that the failure of the Primary Care Access Program could be its signal contribution to the health care debate. There is a growing sense in the Capitol that lawmakers cannot leave Boise this year without addressing the question of health coverage for the poor. PCAP spurred this, may it rest in peace.

Although technically speaking, PCAP isn’t officially dead. But its inherent shortcomings — not cheap, not insurance, not particularly promising, not much better than doing nothing — have lawmakers and others in the Capitol debating not whether to do something, but what to do.

In regular meetings and discussions, such as the weekly meet-up of the governor and legislative leaders, the head counting has begun. The 14 House Democrats could be counted on to vote for a better alternative. That means, in the House, getting at least 22 Republican votes. They might already be more than halfway there.

Where the debate goes from here will be the most significant outcome of this legislative session.

DOING NOTHING ‘UNFAIR AND WRONG’

The status quo that prevents 78,000 Idahoans from getting health care, via either Medicaid or subsidized insurance through the state exchange, “is just unfair and wrong,” Rep. Fred Wood, R-Burley, who chairs the House Health and Welfare Committee, told the joint budget-writing committee last week. Outlining his panel’s overall program recommendations, the retired physician said Idaho needs to find “an equitable and effective answer” for that group.

He’s far from alone in that view, and this year more lawmakers are saying so, although not as publicly. PCAP, though well intentioned, is a white elephant, and legislators have balked, realizing that its millions in costs deliver very little beyond the stopgap care poor Idahoans already access.

If only there were another solution — say, one where the state could tap into hundreds of millions of federal dollars to subsidize health care, but retain a measure of control over how the money was spent.

Hold that thought.

INACTION NOT AN OPTION

This health care discussion is occurring against the backdrop of a modest $29 million tax cut, so far approved only by the House, that would drop the state’s top two income tax rates by a tenth of a point and boost the food tax credit a bit for those that the lowered rates don’t help. The fate of that bill in the Senate is unclear. But it would be exceedingly tone-deaf politics, at the least, for lawmakers to help out the states top wage earners and leave the poorest out in the cold another year.

Starting its seventh week, this legislative session is more than half over. The case for Medicaid expansion to address the needs of the gap group is growing stronger, the economic case for boosting health spending and saving locally paid indigent care taking hold. Still, a majority of the Republican lawmakers who control the Statehouse would oppose straight-out expansion on the basis of objections to Obamacare, entitlements and federal program creep.

To date, 31 states have expanded Medicaid. Six more that opposed it initially have moved forward with alternative plans based on waivers granted by the feds. Two states have waivers under consideration. The waivers vary by state, but essentially, states get some portion of the money they would receive under Medicaid expansion and retain greater control over how it is spent.

So yes, in Idaho, anything called “Medicaid expansion” has slim odds at best. But there’s another way.

CALL IT WHAT YOU WANT

Let’s say the state wants to use the funds to help the gap group obtain subsidized insurance on the existing state exchange, requiring them to make small co-pays and preventing or limiting certain expenditures. These are the kinds of issues other state waivers address.

Idaho prepared, but couldn’t implement, a Washington-approved plan with waivers a couple years ago under one of Gov. Otter’s Medicaid redesign panels. A plan like that could be where things are heading. Instead of “Medicaid expansion,” Idaho could call the lump-sum plan whatever it wants. In Iowa, it was the Wellness Plan; in Arkansas, the Health Care Independence Program.

Idaho would still need to find a way to cover the state’s roughly 10 percent match. Any state health coverage expansion will have costs associated with implementation, but Idaho would realize savings as well — a projected $55 million next year — because the costly state and county programs that cover indigent care would go away. The state health insurance exchange created under the Affordable Care Act already has helped cut those costs.

Look at it this way: The state could spend $30 million on PCAP and still have millions in indigent and catastrophic costs. Or it could eliminate those indigent programs and put the savings and PCAP money toward its share of a health plan that would deliver roughly 10 times as much money from the federal government and provide full health coverage for thousands of people who now get little or no care at all.

Under an Idaho lump-sum plan, the state might not get as much federal cash as it would under plain-vanilla Medicaid expansion. But over time, as the federal reimbursement rate for expansion declines, that might work to the state’s advantage, as it continues to receive an annual amount that is perhaps indexed to income levels or inflation.

The economic case for using federal dollars in Idaho is compelling, as the Statesman reported Feb. 6, promising savings and expansion. And public support has been robust. The most recent public polling on the subject, by the Zions Bank-supported Idaho Politics Weekly news site more than a year ago, found 61 percent support among Idahoans for expanding Medicaid.

Presented with a state-based alternative that, ironically, has proved only its shortcomings, the folks at the Capitol are now doing the math.

This story was originally published February 20, 2016 at 10:18 PM with the headline "Idaho health care debate may have turned a corner."