Arizona Medicaid Expansion Advances After Jan Brewer Forces Lawmakers' Hands

06/13/2013 05:30 pm ET | Updated Sep 13, 2013

Arizona will expand Medicaid to cover nearly 300,000 poor residents next year after a bipartisan coalition passed a measure backed by Gov. Jan Brewer (R) through the state legislature on Thursday.

Brewer, a conservative and avowed foe of President Barack Obama's health care reform law, announced her support for the Medicaid expansion in January, but faced stiff resistance from fellow Republicans in Arizona's House and Senate. During a marathon session that began Wednesday afternoon and stretched into the wee hours of Thursday morning before culminating in a final vote late Thursday afternoon, a handful of Republicans joined Democrats in the House and Senate to pass the Medicaid expansion.

Although Obama's health care law continues to divide elected officials and the public along starkly partisan lines, Brewer is one of nine Republican governors who have bucked their party and embraced the Medicaid expansion.

"With landmark votes today in the House and Senate, legislators have tackled the issue that is Job One every session -- adoption of a responsible State budget -- and enacted Arizona’s most sweeping health care legislation in decades," Brewer said in a news release after the vote Thursday. "It will extend cost-effective care to Arizona’s working poor, using the very tax dollars our citizens already pay to the federal government."

The Arizona governor aggressively promoted the Medicaid expansion since taking her surprising public stand earlier this year. Brewer assembled a coalition of health care interests and business groups and worked alongside Democratic legislators in addition to campaigning across the state in service of extending health coverage to hundreds of thousands of poor Arizonans using Obamacare funding.

Brewer played hardball with Republican legislative leaders in the state to get her way, earning their ire in the process. She followed through on her threat to veto any bill not addressing the Medicaid expansion last month. On Tuesday, she raised the stakes by calling a special session and forcing the temporarily adjourned legislature back to work on Medicaid and the state's budget.

Democratic lawmakers in both chambers unanimously voted for the Medicaid legislation. "We have done truly the right thing for the people of this state," state Senate Minority Leader Leah Landrum Taylor said during the vote Thursday.

Republican legislative leaders and conservative lawmakers have bristled at Brewer's embrace of the expansion, a key component of Obamacare, and objected to her calling a special session when the legislature was scheduled to reconvene later in the week anyway.

"I'm deeply and profoundly disappointed at the manner in which this came down," said Senate President Andy Biggs, before voting against the measure Thursday.

Brewer won praise from conservatives for her hardline stance against illegal immigration, but she has attracted strong right-wing condemnation over Medicaid.

"This proposal is not a freebie for Arizona taxpayers," said state Sen. Nancy Barto, a Republican and the chairwoman of the health committee, on the floor Thursday. "Here we are, once again, putting ourselves at the mercy of the federal government."

The political fallout from the split among Arizona Republicans won't have an immediate effect on Brewer's electoral future: She can't seek another four years as governor when her time runs out next year because of state term limits. She ascended from Arizona secretary of state to the governor's office when Obama tapped then-Gov. Janet Napolitano (D) to be his secretary of homeland security in 2009; voters reelected Brewer in 2010.

Arizona is among the 29 states and the District of Columbia with chief executives who support expanding Medicaid under Obamacare to anyone who earns less than 133 percent of the federal poverty level, which is $15,282 for a single person this year. Majority-Republican legislatures in a number of states have stymied expansions endorsed by their governors, including Florida's Rick Scott (R), Ohio's John Kasich (R), Michigan's Rick Snyder (R), Missouri's Jay Nixon (D) and others.

"This is a big deal because Arizona and Gov. Brewer are very conservative," said Ron Pollack, executive director of Families USA, a consumer advocacy organization that supports the health care reform law. "It shows that at least for this governor and this state, practicality and common sense has prevailed over ideology and partisanship," he said. "This is a reflection of what we're going to see over time in many other states across the country."

But about a dozen Republican governors, including Rick Perry of Texas and Bobby Jindal of Louisiana, remain opposed to broadening the program, citing opposition to Obama's health care law and the expense of the expansion. The Supreme Court ruling that upheld the law last year gave states the right to opt out of its Medicaid provisions.

Under the law, the federal government will pay the full cost of the Medicaid expansion from 2014 through 2016, after which the federal share will gradually decline until it reaches 90 percent in 2022 and beyond. Currently, the federal government covers an average of 57 percent of Medicaid costs and the states pay the remainder.

States that refuse the expansion risk losing $8.4 billion in federal money and face $1 billion in new state spending on programs to compensate hospitals that treat people without health insurance, according to an analysis released last week by the Rand Corporation. About 3.4 million people who could have gained health coverage under Obamacare will remain uninsured next year because of states that won't expand the program, Avalere Health estimated.

The uninsured rate in Arizona was 18 percent in 2011, when 1.2 million residents lacked health insurance, according to census data compiled by the Henry J. Kaiser Family Foundation.

Unique factors affecting Arizona's Medicaid program, called the Arizona Health Care Cost Containment System or AHCCCS, played a role in Brewer's decision to set aside her staunch opposition to Obamacare.

In 2011, a federal court allowed Brewer to freeze enrollment of adults without children into Medicaid to resolve a budget crunch, which resulted in more than 140,000 fewer people on the program, according to Brewer. Accepting Obamacare's federally financed expansion enables Arizona to reopen Medicaid without having to pay about half the cost. This is why Brewer consistently refers to her Medicaid plan as a "restoration" of the program.

Moreover, Arizona expanded Medicaid to cover all adults below the poverty line based on a ballot initiative approved by voters in 2000, which Brewer has cited as justification for participating in the Obamacare Medicaid expansion.

In 1982, Arizona became the last state to join Medicaid, a program President Lyndon Johnson enacted in 1965. Arizona pioneered the use of private health insurance companies to administer the program, an approach since copied by nearly every state.

This story has been updated with comment from Jan Brewer, Leah Landrum Taylor, Andy Biggs and Nancy Barto.

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