NEBRASKA LEGISLATURE

LINCOLN — Opponents have thwarted three past attempts to extend publicly funded health coverage to more low-income Nebraskans.

But backers say they are ready to try again when Nebraska lawmakers reconvene Wednesday.

State Sen. Kathy Campbell of Lincoln, the chairwoman of the Health and Human Services Committee and a leader of past efforts, expressed optimism about the outcome this time.

"I'm very encouraged by the response" from other senators, she said.

This time, Campbell said, she plans to propose a "private option" for expanding coverage, similar to what has been done in Arkansas since 2014.

Arkansas uses Medicaid funds to buy private health insurance for low-income people instead of adding them to the traditional Medicaid program. Medicaid funds also help with co-pays and deductibles and fill some coverage gaps.

Campbell said the goal is to provide transitional health insurance, which people could continue even if they no longer qualify for Medicaid.

"It's a much more streamlined, direct, effective bill" than previous measures, she said.

Unlike in previous years, the fiscally conservative former director of a free-market think tank has emerged as a leader in working to expand coverage:

Sen. John McCollister of Omaha traveled the state in recent months to hold listening sessions about Medicaid expansion and the private option. The sessions were in the districts of senators who opposed previous plans.

McCollister said he became convinced about the need for Medicaid expansion because of the $2.1 billion in federal dollars it would bring to the state over five years, the 77,000 people it would cover and the many rural hospitals it would help.

"It's time to move forward," he said. "Nebraska is already paying the taxes. We're already sending money to Washington and getting nothing in return."

But as in the past, any Medicaid-expansion proposal faces opposition from Gov. Pete Ricketts.

"It will cost taxpayers millions and expose Nebraskans to unreasonable financial risk," the governor said. "Federal spending is out of control, and we cannot count on federal funding over the long term."

Federal funds would pay 100 percent of the cost for covering additional Medicaid recipients through 2016. After that, the federal share would decline to 90 percent by 2022, then stay at that level.

Legislative fiscal staff last year estimated the state's share of costs would total $105 million over five years but would be partly offset by $69 million worth of savings.

Opponents question whether the federal government would stick to its 90 percent commitment, which is higher than its share of costs for other Medicaid programs.

That funding level, McCollister said, is part of federal law. He said it would be difficult for Congress to take the money away from states.

Although the governor did not specifically address the Arkansas plan, he said that "models of implementing Obamacare used in other states are unsustainable."

The Platte Institute for Economic Research, the think tank that McCollister once led, also expressed skepticism. Jim Vokal, its current executive director, said the organization will "in all probability" oppose the new proposal.

State policymakers have been wrestling over Medicaid expansion since the option became available under the federal health care law. The Affordable Care Act envisioned using the state-federal Medicaid program to cover uninsured people with incomes of up to 133 percent of the federal poverty level — or $32,253 for a family of four.

But a 2012 U.S. Supreme Court ruling made the Medicaid expansion voluntary for states, not mandatory.

Since then the number of states adopting the expansion has grown steadily, to 30 states and the District of Columbia. Four other states are considering following suit.

Campbell said the federal government's willingness to grant waivers for plans that differ from traditional Medicaid has helped win approval of expansions in some states.

Six states, including Arkansas and Iowa, have such waivers. Iowa's Health and Wellness Plan uses private insurance for people with incomes of 100 to 133 percent of federal poverty level, uses Medicaid for those at lower incomes and contains incentives for healthy behavior.

Campbell's proposal, too, would require a federal waiver.

Becky Gould, executive director of the Nebraska Appleseed Center for Law in the Public Interest, an advocacy group, said Nebraska now is in the minority among states.

"Hopefully, this is the year this policy solution can get done," she said.

As it stands, able-bodied Nebraska adults without minor children cannot qualify for Medicaid no matter how low their income. Parents and disabled adults can qualify only if their incomes are well below the poverty level.

But people making less than the federal poverty level — $24,250 for a family of four — cannot qualify for tax credits in the health insurance marketplaces, leaving many Nebraskans in a coverage gap.

Gould said Appleseed will support expansion proposals that offer affordable, meaningful coverage to the 77,000 or so Nebraskans in the coverage gap.

Expansion bills failed in the face of filibusters in 2013 and 2014. Last year, supporters put a bill on hold after it became clear it did not have the votes to advance.

The governor's opposition, if expressed as a veto, means expansion supporters would need 30 votes to override. And it would take 33 votes to cut off a filibuster by lawmakers.

It's too early, said McCollister and Campbell, to tell whether supporters have swayed enough votes to get the new proposal across the finish line.

But Campbell said state senators who were new last year have now had more time to study the issue.

"When you start looking at the figures and what Medicaid expansion can do for the state, it's an important decision," she said.

Contact the writer: 402-473-9583, martha.stoddard@owh.com

"It will cost taxpayers millions and expose Nebraskans to unreasonable inancial risk. Federal spending is out of control, and we cannot count on federal funding over the long term."

Gov. Pete Ricketts

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