New Health Care Plan Avoids Budget Strain

Sponsors of legislation to access federal Medicaid expansion dollars to purchase private health care insurance for the working poor said Tuesday they have devised a plan that would have no impact on the state tax-supported general fund.
The proposal would require small premium contributions from most enrollees and some co-pays while pointing recipients to employment, education and skills training programs.
The state would turn to its health care cash fund as "a backup" for financing the plan, which would extend health care insurance coverage to 77,000 Nebraskans, 72 percent of whom are employed in low-wage jobs.
The health care cash fund includes tobacco settlement dollars sent to states for tobacco-related health care costs.
Although the bill makes use of an Arkansas model, Appropriations Chairman Heath Mello of Omaha described the legislation as "a third-way approach" that does not expand the current Medicaid program, but accesses an estimated $2 billion in federal funds available to the state during the next five years to expand health care coverage to uninsured Nebraskans.
Senators immediately formed battle lines over the legislation (LB1032) introduced by Sen. John McCollister of Omaha along with 15 co-sponsors.
As the bill was being placed before the Legislature, 15 other senators joined a Platte Institute for Economic Research news conference in the Capitol Rotunda to signal their opposition to the measure.
"This is the first time that conservatives (in the Legislature) will all be on the same page," Sen. Bill Kintner of Papillion said.
If none of those 31 senators who have expressed themselves thus far changes sides in coming weeks, the bill would need to gain the support of all but one of the remaining 18 senators who haven't publicly picked sides to reach the 33 votes required to clear a filibuster mounted by opponents.
The legislation provides "a pathway to job training and job placement," Sen. Kathy Campbell of Lincoln said.
Recipients would have an opportunity to "transition out to their own health care, employment and education," she said.
Thirty-one states have expanded their Medicaid programs to access the additional federal dollars now available under the Affordable Care Act to increase health care coverage in their states, McCollister noted.
Republican governors in nine states have chosen to participate, he said, and four or five additional Republican governors are in the process of considering joining in.
At stake is 100 percent federal funding of expanded health care coverage in 2016 followed by gradual reduction of the federal share to a 90 percent floor in 2020. The recipients are people who fell through the gap in Obamacare coverage opened by a U.S. Supreme Court decision that allowed states to opt out of Medicaid expansion.
Gov. Pete Ricketts announced his firm opposition to Nebraska's participation during his State of the State address to the Legislature earlier this month.
Campbell, McCollister and Mello said they will meet with the Republican governor soon to brief him on the details of their plan.
"We will show this actually is a conservative approach," Mello said.
It is, in fact, "an innovative, free market approach," McCollister said.
McCollister and Campbell are Republicans; Mello is a Democrat.
The plan would create an estimated 10,000 new jobs, many of them in health care, McCollister said, and provide the state with "an economic tailwind."
The legislation responds to the governor's stated concern that the federal government might abandon its funding commitment by automatically terminating the new program in Nebraska if that occurs, the three senators said.
Introduction of the legislation triggered dueling news conferences in the crowded Capitol Rotunda.
First came the Platte Institute, arguing that the model established in Arkansas and Iowa created "a new entitlement for able-bodied adults that is exceeding enrollment projections and trapping more citizens in poverty."
"Creating a new Medicaid private insurance entitlement with higher reimbursement rates for able-bodied, childless adults means placing a higher priority on the expansion population than those on Medicaid right now: children, pregnant women and low-income parents, the disabled and elderly Nebraskans with long-term care needs," Jessica Herrmann said.
Herrmann is the Platte Institute's director of research.
McCollister was executive director of the institute before he became a candidate for the Legislature.
Ricketts was founder and president of the conservative think tank.
Nebraska Appleseed said the proposal would "create a path to affordable health care coverage for 77,000 uninsured Nebraskans."
The plan would "allow Nebraska to recoup approximately $2 billion in federal taxes to fund health coverage for hard-working Nebraskans and support economic development across the state," Appleseed stated.
Dr. Joe Miller of Lexington, president of the Nebraska Academy of Family Physicians, said his organization composed of 875 members "enthusiastically supports the bill."
Sarah Parker of Lincoln said she fell into the coverage gap when she quit her full-time job and opted to work half-time so she could care for her father, who had Parkinson's disease, at home.
"I don't need an entitlement program," she said, "but I do need a little help right now. Please, give us this chance."

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