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Missouri hospitals caught in middle as politicians grapple with Medicaid Expansion

By Mike Sherry for KHI News Service, Dec. 4, 2012

KANSAS CITY, Mo. – Hospitals in three cities served as backdrops when Missouri Gov. Jay Nixon opened his campaign to expand Medicaid coverage as envisioned by the federal Affordable Care Act.

But small towns like Sweet Springs, Mo., which is about 50 miles east of the Kansas City metropolitan area, might be even more important to Nixon and his coalition of supporters, which includes the Missouri Chamber of Commerce.

“The Republican leadership is from rural Missouri,” senator-elect Paul LeVota, an Independence Democrat, noted after Nixon made his remarks at Truman Medical Centers on Thursday.

“They will feel the pressure (from constituents and hospital officials),” said LeVota, a former state representative who served in the Democratic leadership during his time in the House. “But they will also want to do the right thing for their own community.”

Republicans in the state have criticized the Affordable Care Act, also known as Obamacare, as a federal intrusion into state affairs. The Medicaid expansion is also one area where critics have questioned the costs of implementing the law’s provisions.

Nixon denied that he was ignoring political realities in expressing confidence that the Republican-led General Assembly would approve the Medicaid expansion.

“I think that when we get beyond the political thoughts around it, and get to the long-term policy and fiscal choices, that the right fit for Missouri crystallizes pretty quick,” he told reporters after his appearance at Truman.

He did not elaborate on what that might look like, and neither did House Speaker Tim Jones, a Eureka Republican, in conciliatory comments he made in a Wednesday radio interview on KCUR-FM in Kansas City.

He said that “a lot of my colleagues on the conservative side of the aisle,” including those who are physicians and healthcare attorneys, “are looking at Medicaid transformation, not just expansion. There are better ways to provide services to our Medicaid population.”

Nixon pointed to a study issued Wednesday by the Missouri Hospital Association and the Missouri Foundation for Health. The University of Missouri School of Medicine prepared the report with a consulting firm.

According to the study, the Medicaid expansion would create more than 24,000 new jobs in the state in 2014 alone, including at nursing homes and retail shops that sell health care items.

The combined wages for those jobs in the first year, according to the report, would be about $977 million.

The Affordable Care Act expands Medicaid eligibility to individuals and families making up to 138 percent of the federal poverty level.

Under the act, the federal government would cover 100 percent of the costs of these newly eligible recipients for three years beginning in 2014. After that, states would pick up no more than 10 percent of the costs.

According to the report issued last week, the Medicaid expansion would extend coverage to almost 220,000 additional Missourians. The authors said that from 2014 to 2020, the federal contribution would be $8.2 billion compared with $332.9 million from the state.

In assuming that more patients will have insurance, the Affordable Care Act also reduces the so-called disproportionate share dollars paid by Medicare and Medicaid to hospitals that serve a significant number of low-income patients.

Therefore, people like Julie Davenport worry about a scenario where Missouri does not expand Medicaid as the disproportionate share funding drops. Davenport is chief executive of I-70 Community Hospital, a 15-bed facility in Sweet Springs.

The hospital generates about $10 million in annual revenue, she said, and it provides approximately $1.2 million a year to uninsured patients who can’t pay their bills.

The hospital has seen its annual disproportionate share payment of about $40,000 cut in half, and Davenport said that is a significant cut, when it means the difference between upgrading equipment or hiring an additional worker.

Davenport has it on her agenda to contact state Sen. David Pearce, a Republican from rural Warrensburg. Pearce has supported the hospital in the past, she said, and now she wants to press the case for the Medicaid expansion.

Opponents, she said, “have to see and understand that, if we don’t participate with the Medicaid expansion, there are hospitals that, if they don’t close, they are going to decrease services. It is just economics.”

Pearce did not return a message left at his statehouse office in Jefferson City.

But state Rep. Noel Torpey, an Independence Republican, expressed concern that the state would have to ratchet back on eligibility once it had to pay some of the bill for the expanded Medicaid program.

“It would be cruel to take that money today and kick them off down the road,” he said.

Charlie Shields appeared with Nixon in Kansas City. Shields, chief operating officer for Truman’s Lakewood Medical Center, spent two decades as a Republican in the General Assembly.

When he served, Shields said he focused on maintaining a strong economy in the state.

“Expanding coverage does exactly that,” he said. “It protects Missouri businesses, it protects Missouri jobs, and it creates a healthy workforce for our state.”

The Health Care Foundation of Greater Kansas City is proud to partner with the KHI News Service to provide weekly health stories about health and policy issues impacting the greater Kansas City region. Because it is committed to objective coverage, HCF exercises no editorial control over the content. The KHI News Service is an editorially independent initiative of the Kansas Health Institute.


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