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Montana Legislature to Tackle Medicaid Expansion Renewal

Two parties have different opinions about how program should continue as the 2019 Legislature begins its session Monday

HELENA — Neither Republicans nor Democrats want Montana to be the first state to end its Medicaid expansion program, but the parties have different opinions about how it should continue as the 2019 Legislature begins its session Monday.

Democrats are calling the state’s first three years under Medicaid expansion a success that has benefited the state’s economy and its health care system, while the Republicans who hold majorities in both the House and Senate say they have concerns the program is being misused and want to close some perceived loopholes.

“I’m more than willing to sit down with Republicans or Democrats and say, ‘How do we actually improve the system?'” Gov. Steve Bullock, a Democrat, said in a recent interview with The Associated Press.

However, he said he’d reject conditions that cost more to implement than they might save or that seek to reduce the number of people covered.

This is Bullock’s last legislative session to cement his legacy as he considers a 2020 presidential bid. He made multiple appearances in early voting states last year in which he touted himself as a Democratic leader who can work with Republicans.

Meanwhile, Republicans are preaching unity as the party seeks to regain the governor’s office after 16 years of Democratic control.

Here are some of the top issues that state lawmakers and Bullock will be dealing with during the 90-day session:

MEDICAID EXPANSION

Medicaid expansion, created under the Affordable Care Act, provides insurance coverage for low-income adults who earn too much to qualify for traditional Medicaid. In November, the program insured nearly 95,000 adults.

Montana’s program collects income-based premiums and co-payments and includes a voluntary workforce training program. Hospitals have seen their $400 million cost of uncompensated care cut in half, about 5,000 jobs have been created, and no rural hospitals have closed, Democrats note.

Republican leaders worry people are misusing the system — though there is no data to back that claim — but they don’t support ending the program.

“If I was a betting man, I’d think Medicaid will pass in some form,” said Senate President Scott Sales, R-Bozeman, who voted against Medicaid expansion in 2015.

Sales is urging means and asset testing and work requirements for able-bodied recipients. Bullock and House Minority Leader Casey Schreiner, D-Great Falls, argue the workforce training program should remain voluntary, noting Montana saw a 9 percent increase in labor force participation among able-bodied people who are eligible for Medicaid expansion.

Continuing Medicaid expansion would bring an estimated $675 million in federal money into the state each year while costing Montana $60 million in fiscal year 2020 and $66 million in 2021. If lawmakers end Medicaid expansion when it sunsets in June, the state would have to move some recipients back to traditional Medicaid at a cost of $28 million a year.

That puts Montana’s net cost of continuing Medicaid expansion at an estimated $31 million in fiscal year 2020 and $38 million in 2021. Voters in November rejected an initiative that would have increased state tobacco taxes to help fund the Medicaid expansion program.

BUDGET

Montana’s 2017 legislative session centered on a budget battle caused by falling state revenues, and it was followed by a special session in November to make millions of dollars in additional cuts to avoid a budget shortfall.

Now, tax collections have picked up, and the Legislature and the governor’s office are more closely aligned in forecasting how much revenue the state will bring in over the next two years.

However, they disagree on the need to raise taxes. Bullock proposes increasing state taxes on hotel rooms, rental cars, tobacco products and liquor, some of which would go to cover the state’s costs of the Medicaid expansion program.

Senate Minority Leader Jon Sesso, D-Butte, said he’d support raising tobacco taxes to help pay for health care costs, despite voters’ rejection of the tobacco tax initiative in November’s election.

Sales said there should be enough revenue coming in to fund state services, and he doesn’t “think there’s an appetite for a tax increase” among Republican lawmakers.

HEALTH CARE COSTS

The Legislature is also looking at the cost of health care in general.

The insurance commissioner’s office is supporting a bill that would make insurance companies accountable for monitoring the prescription drug benefits offered through their insurance plans.

The bill would, in part, require prescription benefit managers to base their charges on the published average wholesale price of prescription drugs and use manufacturer rebates to reduce premiums.

The state estimates the bill could save $8 million annually for those who receive coverage through the health insurance marketplace.

INFRASTRUCTURE

While Montana has spent millions of dollars on roads, water and sewer projects in recent years, some projects have gone unfunded because Republican lawmakers don’t want to issue bonds to pay for them.

Others felt rural areas were being short-changed.

Bullock’s budget proposes more money for infrastructure work in communities that were impacted by population increases or declines due to changes in the energy industry.

Supporters argue funding the work will create jobs.

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