With billions of dollars at stake, hospitals are lobbying hard for Medicaid expansion in Columbus, Tallahassee and other state capitals where state legislators oppose the extension of the program to some 17 million Americans.
Hospital associations have paid for television and newspaper ads, organized rallies, and choreographed legislative testimony in support of the Medicaid expansion, which is part of the Affordable Care Act. They also have united disparate groups which are used to being on opposite sides of legislative debates. In Columbus, for example, Ohio Right to Life and Planned Parenthood Advocates of Ohio are working side-by-side to persuade state lawmakers to approve the expansion. Both groups say they want to make health insurance available to the poor.
In making their case, the hospitals tout the economic benefits that an influx of federal money will bring to the states. The federal government will cover 100 percent of the cost of the expansion for the first three years, gradually tapering off to 90 percent in 2020. And they point to the public health dividends that will come from providing health care to people who can鈥檛 afford it now.
But the hospitals also acknowledge that the expansion is vital for their own financial health. 鈥淔or many hospitals it鈥檚 existential; it鈥檚 really talking about the future viability of their institutions,鈥� said Shawn Gremminger of the National Public Hospital Association.
Democratic Sen. Christopher Smith, the minority leader in the Florida Senate, believes the precarious condition of hospitals has the best chance of winning over resistant Republicans. 鈥淚t鈥檚 the plight of the hospitals that is bringing everyone to the table,鈥� he said. 鈥淒o they want to be responsible for the shutting of Jackson Memorial? Or closings in the South Broward Hospital District?鈥�
It is a fight that only 10 months ago, the hospital industry had hoped to avoid.
The ACA is expected to cost hospitals more than $300 billion over 10 years by reducing fee-for-service Medicare reimbursement and cutting federal payments that compensate hospitals for providing free care to the poor. In Ohio, for example, those federal changes would cost hospitals about $7.4 billion over the next 10 years.
Nevertheless, hospital associations agreed to back the law. That鈥檚 because by expanding Medicaid to some of the uninsured and requiring the rest to purchase insurance from health exchanges, the ACA promised to increase the number of people able to pay for hospital services by about 48 million. The Medicaid expansion envisioned under the ACA would cover all adults younger than 65 earning less than 138 percent of the federal poverty level.
The U.S. Supreme Court poked a stick in the spokes by upholding the ACA but making the Medicaid expansion optional for the states. Now hospitals in states that opt out of expansion will have to contend with the ACA cuts without the influx of new Medicaid patients they had expected.
鈥淭he pain part is guaranteed but the gain part depends on the choice each state makes,鈥� said Stan Dorn, a senior fellow on health policy with the Urban Institute.
Most Republican governors initially said they would decline to participate in the expansion. Some have since changed their minds鈥攊ncluding Arizona鈥檚 Jan Brewer, Ohio鈥檚 John Kasich, and Florida鈥檚 Rick Scott鈥攂ut they must win over Republican-dominated legislatures which remain staunchly opposed. Other states with Republican governors, including Maine and Tennessee, still haven鈥檛 decided whether to expand their Medicaid programs. Neither has Arkansas, which has a Democratic governor and a Republican majority in the legislature.
Hospitals are not strangers in state capitals. According to the National Institute on Money in State Politics, the health industry spent $70 million on state legislative races in 2012, roughly the same amount spent by the finance, insurance and real estate industries combined. Rarely, though, do hospitals get involved in a battle with such high visibility.
鈥淗ospitals are pretty active every year, but they鈥檝e definitely stepped it up this year,鈥� said Smith, the Florida state senator. 鈥淚鈥檝e seen more hospital administrators and board members walking the halls than ever. And they鈥檙e not just talking to health committee members but to everyone.鈥�
But hospital lobbyists are finding that many Republican legislators who oppose Medicaid expansion鈥攁nd the health care law as a whole鈥攐n ideological grounds aren鈥檛 convinced by economic and public health arguments.
鈥淭hey are very passionate about why they were elected,鈥� said Jonathan Archey of the Ohio Hospital Association. 鈥淭hey have an ideological frustration or opposition to Medicaid in general and with the president鈥檚 health plan in particular. That makes them mistrustful. They don鈥檛 expect Congress will maintain that high level of funding. They doubt Congress will allow the states to continue to pay 10 percent and they think 10 percent is too high already.鈥�
Even if the logic of the expansion made sense to them, Dorn said, many of those conservative Republican legislators worry that a 鈥測es鈥� vote would make them vulnerable to a primary challenge from the right when they run for re-election.
Their allies give the hospitals credit for their leadership role in the state campaigns. But Cathy Levine, with Universal Health Care Action Network of Ohio, warns that the hospitals will have to do even more if they are going to succeed, at least in Ohio.
鈥淎s much as the hospital association has done in reaching out to members, if this is going to happen in Ohio, given the political dysfunction in the face of overwhelming public support for Medicaid expansion in the state, the hospital association is going to have to step up even more,鈥� Levine said. 鈥淭he ones that get listened to the most in this state are the ones with the deeper pockets. And the hospitals have very deep pockets.鈥�