Governor Tom Corbett hesitates on Medicaid expansion

As Republican Gov. Tom Corbett negotiates whether to expand Pennsylvania’s Medicaid system, millions of dollars for Penn Medicine hang in the balance.

Currently, uninsured patients’ hospital bills must be covered by the hospital. The University of Pennsylvania Health System contributed $121 million to cover uncompensated care in fiscal year 2012, which ended June 30, 2012, said Susan Phillips, senior vice president for public affairs at UPHS.

“People without insurance are likely to seek care through the emergency room rather than regular hospital visits, and the costs of those [ER] visits are absorbed by the hospital and passed along to people with insurance,” law professor Theodore Ruger, a health care policy expert, said.

The 2010 Affordable Care and Patient Protection Act provides federal funding for states to expand the public low-income insurance program to cover all people making less than 133 percent of the federal poverty line — which would cover an additional 542,000 Pennsylvanians, according to the Kaiser Commission on Medicaid and the Uninsured. It would also reduce the uncompensated care.

Though the federal government would cover 95 percent of the cost of the expansion through 2021, Corbett — along with other Republican governors — has remained opposed to expanding Medicaid in Pennsylvania, claiming that it would pose too large a burden on Pennsylvania taxpayers.

However, hospitals have been pressuring the Corbett administration to accept the Medicaid expansion, citing the high cost of covering uninsured patients.

“It’s morally the right thing to do,” Phillips said, adding that the expansion would also mean “less charity care if people have insurance.”

Penn Medicine is part of the Hospital and Healthsystem Association of Pennsylvania, which has lobbied Harrisburg and recently sponsored a report that concluded a Medicaid expansion in Pennsylvania would boost the economy.

A number of Republican governors who initially opposed the Medicaid expansion have changed their mind after receiving concessions from the federal government.

“The general story … is the hospitals in the states have lobbied the states very heavily to take the money,” health care management professor Mark Pauly said. Several states have bargained for more money and less regulation in exchange for acceptance of Medicaid expansion.

Corbett met with Secretary of Health and Human Services Kathleen Sebelius Tuesday to discuss the issue. While details about the meeting have not been released, some have speculated Corbett was attempting to strike a deal.

“You’d turn it down in part because of ideology — it’s expansion of government and you’re opposed to it if you’re a Republican,” Pauly said. “[But] this is a money pump for them, and they’d rather have the money than not.”

Both Ruger and Phillips expect Corbett eventually to join other Republican governors and change his mind on Medicaid.

“As I read the tea leaves coming out of Harrisburg, I think that kind of shift is going on in Pennsylvania,” Ruger said.

“If I were a betting person, I would bet he would [do it],” Phillips added. “It’s easy federal money.”

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