On The Trail
9:40 pm
Sun March 9, 2014

With Medicaid Expansion In Limbo, Some Lawmakers See Promise In Collaborating With Critics

State Sen. Rob Schaaf is a force to be reckoned with when it comes to health-care policy. But some believe that this staunch opponent of Medicaid expansion holds the key to ending the legislative impasse over it.

Credit Jason Rosenbaum/St. Louis Public Radio

The St. Joseph Republican and family physician was a major figure throughout the 2007 overhaul of the state’s Medicaid system. He also helped derail Gov. Matt Blunt’s “Insure Missouri” plan in 2008, which would have provided subsidized insurance to poor  Missourians.

Since he was elected to the Senate, Schaaf has blocked a prescription drug monitoring program as well as a prescription requirement for pseudoephedrine. 

So when Schaaf stands and says, “I will stand and filibuster the expansion of Medicaid until I can’t stand any longer,” people take him seriously. State Sen. Paul LeVota, D-Independence, called Schaaf “the biggest barrier to Medicaid expansion in the Senate.”

Some lawmakers, though, see an opportunity to revive Medicaid expansion by bringing Schaaf to the table.

They point to legislation he introduced earlier this year aimed at increasing the number of health-care providers and publicizing the prices of medical procedures. That may provide the basis for some horse trading. Both, though, are strenuously opposed by the Missouri Hospital Association, a group pushing for Medicaid expansion.

But legislators, such as Senate Minority Leader Jolie Justus, hospital groups may want to change their tune.

“Hospitals need to do some soul-searching over spring break,” said Justus, D-Kansas City. “Because the reality is that they desperately need the Medicaid expansion. There’s no question about that. They really hate the other stuff. Do they hate that other stuff so much that they’re willing to forego the possibility of opening the door to a Missouri-style Medicaid expansion?”

To be sure, Schaaf isn't the only obstacle. Many Republicans will continue to oppose Medicaid expansion even if it incorporates some of Schaaf’s ideas. And Schaaf himself says, “Nobody’s made this offer to me. And I seriously doubt that they will.”

Justus, though, says it’s a mistake to leave Schaaf out of the process.

“Every time there’s been an issue in this building where one senator has been completely entrenched, if you get that senator sitting down at the table and give them a stake in it, it helps things move forward,” Justus said. “Even if it’s just incrementally. And so, I think that the establishment that doesn’t like those issues would be foolish to ignore this opportunity.”

A different approach

Under the ACA, the federal government would pay the full cost of expanding Medicaid up to 138 percent of the poverty level – with the state gradually picking up the tab up to 10 percent. 

Hospitals are among the biggest proponents of the expansion. They fear that if the program isn’t expanded and federal reimbursements go down, rural hospitals will go out of business.

After not passing Medicaid expansion last year, legislators from both chambers held interim committees to examine the issue further. And since then, lawmakers have introduced bills to "reform" the program. For instance: State Rep. Noel Torpey’s bill would change the Medicaid program but expand it to cover more people. It's strongly supported by the Missouri Chamber of Commerce, which is also pushing for Medicaid expansion. 

Legislation from Schaaf and state Rep. Keith Frederick, R-Rolla, takes a different approach. Instead of expanding Medicaid, Schaaf proposes “a package of the market-based reforms that the Republican Party has been saying for so long that we need to pass.” 

Sen. Rob Schaaf, R-St. Joseph
Sen. Rob Schaaf, R-St. Joseph
Credit Missouri Senate

“[We] put together this package of reforms that would increase competition in health care, which would drive down the prices and control the costs so that health care could become more affordable for everyone,” Schaaf said in an interview. “Instead of just increasing subsidies and health welfare, let’s make health care affordable.”

Among other things, the bill would provide loan forgiveness to doctors who practice in “underserved areas.” It would allow doctors who graduated from medical school but haven’t done a residency to work in areas without many medical personnel. 

It would also prompt insurance companies and providers to give patients the cost estimates of medical procedures. Schaaf compared this idea to how Amazon.com or Travelocity work.

“When you made it so that consumers could choose on the basis of price, immediately prices started dropping like a rock,” Schaaf said. “So now, you can buy airline tickets much more cheaply, books and other items from Amazon. You can get things cheaply on the internet because of this price discovery.”

Perhaps the bill's most controversial element changes the state's process for licensing hospitals, nursing homes or purchasing expensive medical equipment. Right now, those who want to open a new hospital or buy an expensive piece of equipment must first obtain a “certificate of need” from the Missouri Health Facilities Review Committee.

While proponents say certificate of need prevents too many health-care providers from flooding a market, critics – such as Schaaf – have argued that big hospitals use it to stamp out smaller competitors. 

“The whole idea here is that the existing competitors in the marketplace have used the legislature over the years to put laws into place to protect them from competition,” Schaaf said. “Insurance companies, they have used the legislature to make it so that competition isn’t active in health care. That helps to drive the cost up. And when the costs are high, insurance companies make more money.”

Powerful opposition

Schaaf’s proposals have always run into major opposition from hospitals, and that opposition hasn’t softened over time. But both Justus and LeVota say Schaaf's ideas may be worth considering.

Sen. Paul LeVota, D-Independence
Sen. Paul LeVota, D-Independence
Credit Missouri Senate

LeVota, a member of the Health Facilities Review Committee, said, “Some of the processes need to be refined." 

That doesn’t mean that LeVota wants to blow up the certificate of need process. “I do believe you have to have the oversight to make sure you don’t have specialty hospitals cherry-picking patients who can pay and then leaving everybody else behind,” he said.

But if more people have insurance – either through expanded Medicaid or through the health exchanges – he said he agreed that it might be worth it to give the program a fresh look.

Justus added, “As I consumer, I would like to know the difference between having my surgery done in Hospital A or Hospital B. On the flip side, I do have concerns about private companies coming and setting up strip mall gastroenterology services."

"Let’s come up with a plan that addresses concerns on both sides," she added. "It’s not that hard.”

Powerful opportunity?

Indeed, some Democrats see an opportunity with Schaaf’s bill. 

Credit Flickr/rosemary

By incorporating Schaaf’s ideas into legislation to expand Medicaid, he might consider not talking the bill to death. 

When asked about this possibility, Schaaf said: “Hmmm. Well, I’d have to do an analysis.” He said he would have to weigh the costs of Medicaid expansion with how much Missouri residents would save from "changing the market."

For his part, Torpey said, “I believe when it comes to reform, nothing’s off the table.”

“I really think the driving force in the state of Missouri is going to be reform,” said Torpey, whose bill will be heard in a House committee on Monday. “So I’d be more than happy to look at any legislation that deals with any type of reform.”

When asked how his group would react if the substance of Schaaf and Frederick's bill was included with a Medicaid expansion, Missouri Hospital Association spokesman Dave Dillon said: "We don’t know." 

"I can’t intelligently comment on whether anything is a deal-breaker without seeing the language of the bill.  Moreover, we don’t even know what Medicaid expansion could look like in the coming weeks," Dillon said. "Our focus at this point is working through the mechanics of the reform and expansion options.  Everything, including Medicaid, is hypothetical."

Schaaf, though, doesn’t see the hospital industry pursuing that strategy. And even if he did change course, he noted that the Senate recently voted down a Medicaid expansion on party lines. “If I were to flip my position, I doubt that all those others would just follow me,” he added.

Indeed, Justus said if "there’s six other senators who say ‘no way, no how,’ then it’s not worth” pursuing Schaaf. But, she said, keeping “the ball moving forward” makes sense.

Legislators "would be foolish to ignore his concerns, especially if that really is one of the last obstacles,” she added.

On the Trail, a weekly column, weaves together the intriguing threads from the world of Missouri politics.