Kentucky Gov. Matt Bevin on Medicaid: ‘We Need to Rethink the System’

WASHINGTON — Divisions over possible changes to the nation’s Medicaid program were on display Saturday between Democratic and Republican governors from around the U.S. as they gathered for a meeting in the nation’s capital.

Democratic governors voiced strong opposition against revamping the now open-ended health care entitlement program so federal dollars are subject to caps or delivered to states in block grants. Republican governors, meanwhile, were reportedly considering support for proposals that would limit federal Medicaid spending, while allowing states to have greater control over the program.

Republicans in Congress are weighing changes to Medicaid as they and President Trump push for a repeal of the Affordable Care Act, also known as Obamacare. Depending on how any alterations take shape, they could have significant implications for state budgets and for people now covered by Medicaid, which provides access to health care for lower income Americans.

“Block grants, in Republican-speak, means less money today and less money tomorrow and every year thereafter,” Connecticut Gov. Dannel Malloy, chair of the Democratic Governors Association, told Route Fifty during the National Governors Association winter meeting.

“What the Republican plan is, is to take trillions of dollars out of medical coverage so that they can give their wealthiest friends tax breaks,” he added. Malloy said he believes Medicaid could be changed to make it stronger, but “not with block grants, not with less money.”

Kentucky Gov. Matt Bevin, a Republican, offered a different perspective.

Asked if proposals for overhauling Medicaid that are now circulating would affect his state’s finances negatively, he replied: “There will be an impact, no question there will be an impact. What I’m saying and what I think other governors are saying: ‘trust us, we’ll handle the impact.’”

“We need to rethink the system,” he added. “It’s not purely a function of enrolling people and thinking we’ve helped them, giving them coverage if that doesn’t actually lead to anything.”

Bevin stressed that there had been a good dialogue about health care between Republican and Democratic governors in an afternoon session at the National Governors Association meeting.

He also emphasized that plans for how to rework the nation’s health care system were still in flux. “It is gelatinous, that’s your word of the day,” he said. “It is this sort of amorphous thing that is yet to gel up and until it does we don’t know what it will look like.”

President Trump had a “working lunch” on Saturday with Florida Gov. Rick Scott and Wisconsin Gov. Scott Walker, both Republicans, to discuss “how best to solve the problems of Obamacare,” according to a White House Press release.

Draft documents showing proposals Republican governors are said to be considering endorsing for Medicaid were published online by Vox on Saturday.

These showed GOP governors were open to states having an option between per capita caps, under which there would be a limit on the reimbursement states receive per enrollee, and a block grant system where states would receive a set amount of money for the program.

The way Medicaid is set up now, funding is open-ended and fluctuates according to factors like costs for care and enrollment.

A letter Malloy and Washington Gov. Jay Inslee sent on behalf of the Democratic Governors Association Saturday to House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell outlined the group’s disapproval for both block grants and per capita caps.

The letter said restructuring Medicaid with block grants or per capita caps “would flood states with new costs” and “throw state finances into disarray.”

Details about a draft House Republican bill in Congress to repeal Obamacare and make changes to Medicaid were revealed in several news reports this week. The draft proposal indicates GOP lawmakers are looking to impose new limits on Medicaid spending.

About 74 million people nationwide late last year were covered by Medicaid and the related Children's Health Insurance Program, or CHIP.

During fiscal year 2015, Medicaid spending totaled around $532 billion, according to figures compiled by The Henry J. Kaiser Family Foundation. The federal government picked up about $334 billion, or roughly 62 percent of those costs, while states covered around 37 percent.

“It’s not as if it’s in a pot somewhere,” said Bevin as he discussed the federal money that goes toward Medicaid. He added: “No one seems overly concerned about or focused upon the fact that, as a nation, we currently have $20 trillion in debt.”

Bevin, who has been a tough critic of the Affordable Care Act, took office in 2015 promising to dial back Kentucky’s Medicaid expansion under the law and to shut down the state’s Kynect online health insurance marketplace.

Arizona Gov. Doug Ducey, a Republican, told Route Fifty he favored giving states an option of block grants or per capita caps.

“Why don’t we provide both out to the states and let the governors make the choice,” he said.

“Governors have been asking for years that we can have charge over the health care system and the spend,” Ducey said, “and that we have the flexibility that’s available to do that.”

Asked if he was concerned that flexibility could result in less federal money going to his state for Medicaid, he said: “I think when you lessen the size of the bureaucracy, you’re going to find efficiencies and savings.” Ducey then added: “What I don’t want to see happen is any individual citizen have the rug pulled out from underneath them.”

Alaska Gov. Bill Walker, an Independent, noted in an interview that when it comes to health care, “not every state’s equal.”

“In some states, you know, you call an ambulance, you go for a five-mile ride to the hospital,” he said. “In Alaska you call an ambulance, it’s a medevac.”

About 171,000 Alaskans were enrolled in Medicaid and CHIP as of last November. The state has roughly 741,000 residents. Alaska received about $834 million from the federal government of the $1.4 billion spent in the state on Medicaid during the 2015 fiscal year.

“I want to make sure we’re not in such a hurry to change it that we hurt people along the way,” Walker said as he discussed Medicaid. “A quick snap of the fingers solution,” he added, “or appearance of a solution, will be very detrimental, I think, to a lot of people.”