Saturday, October 20News That Matters

Virginia House backs Medicaid expansion, with a bad twist

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The Virginia House has included a Medicaid expansion in its budget for the next year, though the Senate budget does not include it. That’s problem No. 1—they’re going to have to fight that one out. But there’s a bigger problem.

Under the House Appropriations plan, Medicaid eligibility would be extended to couples making about $16,000 per year and families of four making about $25,000 per year.

Virginia would also seek a waiver from the Trump administration in order to institute a work requirement for many Medicaid beneficiaries. Gov. Ralph Northam, a Democrat, has agreed to that provision and praised the expansion plan.

Northam needs to do a little more digging before he signs off on that work requirement waiver. First of all, it’s currently subject to litigation and might not stand, since it’s questionable at best whether adding that requirement is allowed under current Medicaid law.

Just as importantly, in Kentucky—the first state where it’s being implemented—the state itself is expecting the administrative costs of implementing it to be far higher than if they didn’t have the requirement, even counting the 100,000 people they expect will leave the program.

It’s an expensive proposition that likely won’t work to move any “able-bodied” person from Medicaid to full-time employment with benefits. That’s because most of the people who are on or need Medicaid are already working, or can’t work because of age, disability, student status, or they’re full-time caregivers to someone else in the family.

The hoops that uninsured people would likely be required to jump through to get and to maintain Medicaid coverage will likely result in mediocre enrollments. Certainly not all of the 300,000 eligible and uninsured Virginians are going to be signing up.

On the other hand, the legislature could end up taking the expansion and the work requirement could be struck down, so it’s possible—in the long term—that this is a decision that makes sense. But it’s one Northam needs to be considering very carefully.