April 27, 2013

Maine Democrats offer deal on debt to hospitals

Gov. LePage blasts the proposal, which links repayment of the debt to an expansion of Medicaid.

By Steve Mistler smistler@pressherald.com
Staff Writer

AUGUSTA – The Legislature's Democratic leaders have told Gov. Paul LePage that they will pass his plan to pay back Maine's hospitals but they want it directly linked to the state's participation in a federal program to expand health care coverage for low-income Mainers.

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Maine Senate President Justin Aflond, left, and Speaker of the House Mark Eves

Staff File Photo

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Gov. Paul LePage

Shawn Patrick Ouellette / Staff Photographer

LePage blasted the proposal Friday, saying Democrats had "reneged" on their agreement to pay the state's 39 hospitals for overdue Medicaid reimbursements.

House Speaker Mark Eves, D-North Berwick, and Senate President Justin Alfond, D-Portland, told the governor their plan Thursday during a closed-door meeting in the governor's Cabinet Room. It marks a shift in the debate over paying back more than $484 million to the hospitals and a separate policy to expand Medicaid to about 55,000 Mainers. 

The two proposals have been linked because Maine's hospitals, which are influential in state politics, support both. But the Democrats' proposal is their first attempt to directly tie LePage's hospital payback plan to his acceptance of federal dollars to expand Medicaid.

It's also one of the first attempts by Democratic leaders to assert themselves by leveraging their legislative majority to advance one of their primary policy initiatives. 

Eves has said that expanding Medicaid through an initiative in the Affordable Care Act is the "right thing to do morally, practically and economically."

Democratic leaders are gambling that popular support for expanding health care coverage will win over claims that they're delaying repaying the hospital debt.

Republicans and LePage have made great use of the latter claim: LePage's political allies have run television ads claiming that former Democratic Gov. John Baldacci and the Democratic-led Legislature are responsible for the debt. The ad claims that the debt has caused layoffs and jeopardized health care for "seniors and families."

LePage made a similar statement in a news release late Friday afternoon. 

"Maine expanded welfare 10 years ago, and we still haven't paid that debt," said LePage. "Mainers know that hospitals provide good jobs and are vital to the local economy. They know that paying our bills is the right thing to do. So why are Democrats still refusing to pay the hospitals?"

The Medicaid debt began accumulating years before Baldacci took office in 2003. It has been attributed to a payment system that didn't keep pace with hospitals' Medicaid claims to the state.

Baldacci and the Legislature made payments that sent $3.7 billion to hospitals over the last decade, but not enough to erase the debt.

On Friday, Democratic leaders said tying the hospital payback to Medicaid expansion makes sense. An analysis by the Kaiser Family Foundation projected that Maine will save $690 million in the next 10 years if it accepts the federal dollars. 

"By accepting federal health care dollars and repaying our hospitals in one fell swoop we will cover more Mainers, save the state and hospitals money, and boost our economy," said Eves. "This is a common sense marriage of ideas. It's important to approach health care in a comprehensive way that both addresses past obligations but also reduces costs and expands coverage going forward. To do one without the other would leave our work only half done."

Alfond issued a news release Friday night saying: "Democrats are committed to paying back the hospitals and plan to do so. In addition, we want to help solve the health care crisis and need a comprehensive approach to managing our health care costs -- and that includes accepting federal health care dollars."

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