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'Fallback' plan for Medicaid expansion in Utah pitched in closed GOP caucuses

FILE - New Utah Senate President Stuart Adams, R-Layton talks about issues and the up-coming session during an interview at the Capitol in Salt Lake City on Monday, Jan. 14, 2019. House and Senate Republicans are meeting behind closed doors Thursday to co
FILE - New Utah Senate President Stuart Adams, R-Layton talks about issues and the up-coming session during an interview at the Capitol in Salt Lake City on Monday, Jan. 14, 2019. House and Senate Republicans are meeting behind closed doors Thursday to come up with changes that will get a replacement bill for the voter-approved Medicaid expansion through the Legislature.
Scott G Winterton, Deseret News

SALT LAKE CITY — House Speaker Brad Wilson, R-Kaysville, said Thursday work is underway on adding a "fallback plan" to SB96, the GOP leadership-backed replacement for the full Medicaid expansion approved by voters.

"We're working on a lot of different options right now. It's a concern, I think, for all of us," Wilson told reporters after House Republicans met behind closed doors midday to discuss proposed changes to the bill that's already passed the Senate.

A fallback plan would take effect if federal approval doesn't come through for the more limited long-term Medicaid expansion in SB96. The bill already includes a so-called bridge plan that would be funded for 18 months.

The question appears to be how close a fallback plan would be to Proposition 3.

The speaker said "it's possible" the plan would extend Medicaid coverage to the same population as Proposition 3, the ballot initiative approved by voters in November.

The Capitol in Salt Lake City is pictured on Friday, Jan. 25, 2019.
FILE - The Capitol in Salt Lake City is pictured on Friday, Jan. 25, 2019.
Silas Walker, Deseret News

Nothing, Wilson said, is "completely on or off" the table as the changes are being put together, with the hope the bill is ready for a House vote Friday. If approved, SB96 would have to go back to the Senate for concurrence, likely on Monday.

He said lawmakers recognize the need "to have a path that we can continue to do both things, manage the state budget, but also, we don't want to be disenrolling people and taking coverage away. That's the final piece."

What is being discussed is a two-part proposal, a legislative source told the Deseret News, that would switch to one plan on Jan. 1, 2020, if the waivers aren't in place and then another as of July 1, 2020, if needed.

Both plans would provide Medicaid coverage to Utahns earning up to 138 percent of the approximately $12,000 federal poverty rate at a 90 percent to 10 percent federal to state funding match, the source said, the same as Proposition 3.

But, the source said, the first fallback plan also adds the work requirement in SB96, requiring federal approval to be implemented. The second fallback plan kicks in if the approval is not granted, without the work requirement.

The House speaker said he believes a fallback plan won't be needed.

"I will just emphasize that it is highly unlikely that we need to be concerned about this," Wilson said, expressing confidence the federal government will approve the waivers needed.

So did Gov. Gary Herbert.

"I think Utah's going to be on the cutting edge of this, coming up with a new, innovative way to expand Medicaid," the governor told reporters. "I feel good about the direction."

Utah and other states have tried and failed in the past to get federal approval for similar modifications to full Medicaid expansion. Herbert said what's different now is that the Affordable Care Act "is here to stay."

Still, he praised the efforts of lawmakers to make sure an alternative plan is in place.

"I always think it's good to have a Plan B," the governor said. He said having a fallback plan in the bill would turn out to be "a very wise and prudent thing, if we get turned down" for the waivers.

In that case, Herbert said, Utah would "still have the ability to do a zero to 138 percent, cover everybody, have a 90-10 split but have the ability for the Legislature to come back" and add what he termed "guard rails."

SB96 has already been amended in the House Business and Labor Committee to remove language repealing any Medicaid expansion if federal waivers aren't approved.

But the sponsor of the amendment, Rep. Jim Dunnigan, R-Taylorsville, who is also the House sponsor of SB96, voted against advancing the bill out of committee Wednesday, along with two other Republican House members.

Dunnigan said Thursday that without further changes, he won't vote for the bill on the House floor.

"If it's in the same format as yesterday, I won't vote for it. We're working on changes. We'll see if we can get there," Dunnigan said. He said he did "most of the talking" in the caucus meeting.

Senate Republicans also held a closed-door caucus to talk about SB96. The bill passed the Senate 22-7 last week, with only a single Republican, Sen. Todd Weiler, R-Woods Cross, joining the Senate's six Democrats in opposition.

"We're kind of waiting to see what they're going to do with this bill and what they're talking about is wanting to have kind of a 'what if,' I think, approach to this," Senate Majority Assistant Whip Ann Milner, R-Ogden, said.

Milner said the caucus will want to see details from the House before deciding whether to support any changes to the bill. "We need to see something finalized out of the House before we react," she said.

Senate President Stuart Adams, R-Layton, said before the caucus that he's seen multiple options for changing SB96 but because "this issue is so significant, we will find a way forward."

House GOP leaders have said they need a fallback plan added to SB96 to make the bill palatable to a veto-proof supermajority, at least 50 of the 59 Republicans in the 75-member chamber.

A supermajority would also prevent backers of Proposition 3 from launching a referendum to put a repeal of SB96 before voters in the next general election, in November 2020.

And having the support of at least two-thirds of both the House and Senate also permits a bill to take effect immediately with the governor's signature. Without a supermajority, SB96 would not take effect until after the April 1 start date in Proposition 3.

Federal waivers are not needed to implement the full Medicaid expansion in Proposition 3.

Backers of SB96 says the 0.15 percent sales tax increase in Proposition 3 isn't enough to sustain full Medicaid expansion long term, even at the 90 percent to 10 percent federal to state funding match for full expansion.

So the bill, sponsored by Sen. Allen Christensen, R-North Ogden, seeks permission to provide Medicaid for Utahns earning only up to 100 percent of the federal poverty rate at the same 90-10 funding match.

Those making between 100 percent and 138 percent are able to buy federally subsidized insurance through the Affordable Care Act for as little as $22 a month, Christensen said.

The bill also places other restrictions on Medicaid expansion including a work requirement and enrollment caps intended to help control costs, which also require federal waivers.

While waiting for the Trump administration to act, a bridge plan would provide Medicaid coverage for Utahns earning up 100 percent of poverty at a more expensive funding match for the state, 70 percent to 30 percent.

The bridge plan originally cost more than $70 million, but the price tag to taxpayers was dropped to about $49 million just before last week's Senate vote. That's still about five times as much as full expansion under Proposition 3.

Utah Decides spokesman Andrew Roberts said the group behind Proposition 3 remains "laser-focused on defeating the repeal bill currently moving through the Legislature."

Roberts raised concerns about Utahns who fall into the 100 percent to 138 percent of poverty category and have to purchase insurance coverage rather than receive Medicaid coverage.

"Health insurance is only valuable if you can afford to use it," he said, adding that under SB96, "Utahns would have to pay 20 percent of their income if they get sick. This isn't what we voted for."