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Maine's Hospital Debt: Panel Endorses Plan to Link Payment to Medicaid Expansion
05/15/2013   Reported By: A.J. Higgins

Another step forward - sort of - for one of the most contentious issues in Augusta this legisaltive session: how to pay of nearly a half-billion dollars in Medicaid debt owed to Maine's hospitals. Members of the Appropriations Committee are leaning toward adopting a Republican proposal that would use a revenue bond to repay the hospitals, funded by liquor sales. But the Health and Human Services Committee voted to include the expansion of Medicaid as part of the plan, which is strongly opposed by many GOP lawmakers. A.J. Higgins has more.

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It started off as a simple plan for renegotiating the state's wholesale liquor contract that will expire next year. Then, Republican Gov. Paul LePage called for linking that deal to the repayment of the state's $181 million share of outstanding Medicaid debt owed to maine hospitals.

LePage then offered to release more than $100 million of voter-approved infrastructure improvement bonds if Democrats would go along with his plan. Democrats responded by throwing their won precondition into the mix: the expansion of Medicaid for 70,000 Mainers offered under the federal Affordable Care Act.

Now, two of three key committees are advancing the proposal as a single package, and state Rep. Drew Gattine says no one should be surprised. "Well there isn't any secret that there's been a lot of public discussion regarding how and when to move forward with this initiative," Gittane said.

The complex proposal has been divided among three panels: Veterans and Legal Affairs, Appropriations, and Health and Human Services. The Health and Human Services committee has now voted 10-4 in favor of recommending that Veterans and Legal Affairs include Medicaid expansion in their bill.

LePage and some Republicans want to negotiate directly with the feds over Medicaid expansion, and have opposed linking that issue with the hospital repayment plan. LePage claimed he was blindsided by the Health and Human Services Committee vote.

House Republican Leader Ken Fredette said he's surprised by the vote. "It really shows the lengths to which the Democrats are hiding the ball and really don't believe that Medicaid expansion on its own can pass," he says.

Republicans have been pushing for a straight up or down vote on Medicaid expansion, believing that doubts over whether the federal government will pick up the bill would prompt lawmakers to vote against it. But Democratic House Speaker Mark Eves says linking the Medicaid expansion proposed by President Obama makes sense because much of the future health care costs for the poor that drove the hospital debt in the first place would be covered under Medicaid.

"We feel very strongly that these things need to happen together at the same time," he said. "As we pay back our hospital debt, which we are doing, we need to make sure that we are really addressing the costs of health care in our system so that we're not back here in the same place," Eves said.

Although one Republican on the Health and Human Services Committee supported the plan, four were opposed.

"I think it's foolhardy to put these together," said Republican state Rep. Deborah Sanderson, of Chelsea. "One is time-limited; one, we should take our time. Putting them together, I think, is inappropriate, and I'm not going to be supporting this motion."

Maine Senate President Justin Alfond expressed frustration with the GOP position that he says will be influenced by their constituents who will recognize the bill's value.

"Why are they so inflexible, and so ideologically driven to this proposal that they can't understand that this is a win-win," Alfond said. "A win-win for the state, a win-win for the hospitals and a win-win for our future."

The recommendations for the revenue bond and Medicaid expansion will now go to the Veterans and Legal Affairs Committee to be included in their vote on the liquor contract bidding plan.

Committee Senate Chair John Tuttle, a Sanford Democrat, earlier signaled his opposition to including Medicaid expansion into his bill but is now supporting the linkage. A vote on the plan by the LVA Committee could take place later this week.


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