Medicaid expansion debated in House

The first public airing of Gov. Jan Brewer's proposal to expand Medicaid was a four-hour, wide-ranging, sometimes- vitriolic debate Wednesday that offered a preview into how nasty this year's biggest legislative battle could become.

The informational hearing before the House Appropriations Committee didn't yield new information or formal action, but dozens of people testified about the perceived benefits and evils of expanding the Arizona Health Care Cost Containment System, the state's Medicaid program, under the federal health-care overhaul.

An overflow crowd jammed the hearing room and another room down the hall, lawmakers talked over each other and exchanged snide remarks, and a Republican Party official likened the governor to Judas.

Patients, health-care professionals, business owners and people who work with the poor and the mentally ill said broadening eligibility for Medicaid and uncapping a program that insures childless adults would be a lifeline to hundreds of thousands of Arizonans, a huge relief to hospitals across the state treating a growing number of uninsured and ultimately bring savings for taxpayers.

But opponents of expansion, including committee Chairman John Kavanagh, R-Fountain Hills, and GOP officials, said adding 400,000 people to the state-federal program for the poor and disabled, taxing hospitals to help pay for it and accepting billions in new federal funding would only add to the country's dangerously high debt without solving the problem of skyrocketing health-care costs.

The debate among committee members frequently devolved into partisan bickering, but people who waited hours to testify were testament to the issue's significance.

"AHCCCS has been my lifeline, and it is the reason I can see all of you right now," said Chantal Duquette, 25, an Arizona State University senior who has an autoimmune disorder that could blind her without proper treatment. "By supporting AHCCCS, we are contributing to the future of Arizona."

Duquette's health coverage will end Dec. 31, along with an estimated 50,000 other Arizonans insured under a voter-approved program for childless adults that legislators capped to help balance the budget in 2011 and which is due to expire. Under Medicaid expansion, those earning up to 133 percent of the federal poverty level, or just under $15,000 a year, would be eligible for AHCCCS.

The governor's plan is backed by a coalition led by the Arizona Chamber of Commerce and the health-care industry, but her harshest critics are conservative Republicans, particularly precinct committeemen.

GOP groups in three counties and numerous legislative districts have passed resolutions calling for lawmakers to reject expansion, and testimony from Maricopa County GOP Chairman A.J. LaFaro showed how ugly the issue has become.

"Jesus had Judas. Republicans have Governor Brewer," LaFaro said before walking away from the podium.

Though there were some groans in the audience, committee members did not rebuke him. Brewer chief of staff Scott Smith, however, had words with LaFaro outside the House, and House Speaker Andy Tobin, R-Paulden, sent a tweet calling for LaFaro to apologize and resign.

"Obviously, his statement was irrational and unhinged," Brewer spokesman Matthew Benson said. "But if that's who opponents of the governor's plan want to have as their spokesperson, I say, 'Fantastic.'"

Brewer's proposal would bring in nearly $1.6 billion in additional federal funding in 2015, the first full year of expansion, and pay for the state's share with an assessment on hospitals. The so-called bed tax is expected to raise $256 million in 2015 by pulling in additional federal matching funds.

In addition to objections over federal debt and government-run health care, many Republican lawmakers believe the hospital tax should be subject to a two-thirds majority under a 1992 ballot measure, Proposition 108, designed to make it more difficult for the Legislature to raise taxes and fees. The GOP governor has enough votes to get a simple majority in the Senate, and likely in the House, but a supermajority would be far more difficult to muster.

"I think we need to take Prop. 108 very seriously," said Rep. Justin Olson, R-Mesa, and be prepared for the state to be sued if the measure passes without a two-thirds majority.

Legislators also argued over whether there was another option available: asking federal health officials to continue the childless-adult program and the 66 percent funding match that comes with it. If Arizona agreed to expand Medicaid, federal funds would pay for 85 percent to 100 percent of the cost.

Kavanagh said growing the program is not the way to get hold of health-care costs.

"When people have insurance, they use it," Kavanagh said. "There is going to be a tsunami of new people seeking medical treatment."

Dozens testified that insuring more Arizonans would save the state money by preventing unnecessary hospitalizations and emergency-room visits.

Yavapai County Attorney Sheila Polk said she has seen more people with mental illness wind up in jail as Arizona has reduced funding for AHCCCS and mental-health treatment.

"Incarceration is an expensive way to provide mental-health care," Polk said. "And, of course, it's not the appropriate or humane way to treat those with mental illness."

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