Is Louisiana ready to expand Medicaid?

Outgoing Louisiana Governor Bobby Jindal (R) adamantly opposed everything about the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), including Medicaid expansion, and the Republicans in the legislature supported him. Yet, in June 2015, as Jindal began his last months in office, the legislature passed a budget that provided for Medicaid expansion. The Louisiana Hospital Association agreed to an assessment on hospitals to help pay the cost, contingent on the state expanding Medicaid. The bill was veto-proof because it was a legislative resolution, which did not require the governor’s signature. And it had plenty of Republican support.

As Republican legislators anticipated the post-Jindal political environment, they began to consider expansion seriously. In the run-up to the gubernatorial election, all four major candidates, including three Republicans as well as Democrat John Bel Edwards, supported Medicaid expansion in some form. Edwards called for traditional expansion, with no waiver or special conditions.

In November 2015, in a run-off, Louisiana voters elected Edwards. Initially, he said he would expand Medicaid by executive order “on day one.” Although he has retreated from that position, Edwards maintains that Medicaid expansion is “one of his top priorities.”

In early December, the Senate Finance Committee asked the state Department of Health and Hospitals to prepare proposals outlining the state’s options for Medicaid expansion—by January 1, 2016. Edwards assumes the governorship on January 11, 2016.

Challenges ahead

New Orleans news sources report that Governor Jindal has agreed that the Department of Health and Hospitals may provide Edwards and his team with information, but has not directed the agency to be helpful or act with speed. But even when Edwards is in control, the state will face challenges.

One reason that Republicans have come to accept expansion is that the state currently has a shortfall; it lacks the funds to meet the Medicaid expenses in the current year because the state did not appropriate enough money to pay the state’s share. Louisiana’s Medicaid enrollment grew more than was expected even without expansion. With that history, it’s hard to anticipate how many more people will enroll in expanded Medicaid. Estimates range from 230,000 to 500,000.

The state will have to hire additional workers to determine eligibility of the expansion population. Because eligibility is redetermined every year, some of those new workers will  have to be permanent.

Louisiana has traditionally provided hospital services to the poor through centralized charity hospitals in Shreveport and New Orleans. Under Governor Jindal, the state began to decentralize and privatize the charity hospital system. The federal funds it used are scheduled to decrease over the next several years.

Because 2016 is the last year of 100 percent federal funding for expansion, the state must find a way to come up with the required state funds. This, too, is likely to be a challenge.