Arizona Medicaid Expansion Puts Jan Brewer On The Defensive

WASHINGTON, DC - FEBRUARY 27:  Arizona Gov. Jan Brewer attends a meeting of the National Governors Association in the State D
WASHINGTON, DC - FEBRUARY 27: Arizona Gov. Jan Brewer attends a meeting of the National Governors Association in the State Dining Room of the White House February 27, 2012 in Washington, DC. The governors will conclude their three-day winter meeting today. (Photo by Chip Somodevilla/Getty Images)

Now, it's Republican Arizona Gov. Jan Brewer's turn to fight off attacks against Obamacare.

Brewer, who became a conservative darling for her hardline immigration stance, is now a taking potshots from her erstwhile allies on the right wing over her decision to expand Arizona's Medicaid program under President Barack Obama's health care law.

During her State of the State address last week, Brewer argued that Arizona shouldn't refuse the generous federal funding that comes with the Medicaid expansion, especially since the state already has a broader Medicaid program than most, and that Arizonans shouldn't pay federal taxes to support Medicaid expansions in other states but see none of the benefits themselves.

Last week, National Review's editors described Brewer's move on Medicaid like this: "Governor Brewer, exemplifying that unfortunately common strain of Republican leadership that is uncompromising in rhetoric but opportunistic in reality, has decided to sign off on the federal government's plan to radically expand Medicaid eligibility."

The Pheonix-based Goldwater Institute, named after the late Arizona senator and one-time GOP presidential nominee Barry Goldwater, jumped into the fray Thursday with a post by Byron Schlomach blasting the Medicaid expansion as too costly and too tied to the rest of Obamacare. Schlomach urged Arizona's GOP legislative majority to block Brewer's Medicaid plan. "Legislators who value fiscal prudence, the health of the state's future economy, and individual liberty should not support the expansion of Medicaid."

Other conservative commentators also have blasted Brewer's plan, including Americans for Prosperity and Avik Roy at Forbes.

Brewer's office decided not to let the Goldwater Institute's criticisms go unanswered and distributed a point-by-point rebuttal of Schlomach's arguments to reporters Friday. The response defends Arizona's proposed Medicaid expansion by noting it would add just 57,000 people to the program, that it's paid for using a combination of federal dollars and fees levied on hospitals, and that Arizona can back out of the expansion if federal funding falls short.

This marks quite a turnaround from last June, when Brewer reacted with horror to the Supreme Court decision affirming the health care reform law.

"For defenders of freedom and the free market, the decision to uphold ObamaCare is nothing short of disheartening. The ramifications are sure to be vast, including a new tax on middle class Americans and the erosion of individual liberty as Americans begin to see their health insurance choices dictated by an overbearing federal government," Brewer said at the time in a statement.

The Supreme Court ruling, by the way, is the reason Brewer is in this position in the first place. The Court upheld the law but gave states the right to refuse the Medicaid expansion. Brewer is one of just four Republican governors so far to support broadening coverage of poor people whereas 10 other GOP governors are already on record against it.

(Brewer also may be motivated by an odd quirk of the Supreme Court ruling that might mean some immigrants get a better deal than U.S. citizens in states that don't expand Medicaid.)

Idaho Gov. C.L. "Butch" Otter (R) is another Obamacare antagonist who's now defending it, at least in part. Unlike Brewer, Otter rejected the Medicaid expansion but decided the state would create and manage its own health insurance exchange under the law. Last week, Otter's office released a document answering criticisms of his plan. And in Virginia, Republican officials who've refused both the Medicaid expansion and the health insurance exchange are nevertheless preparing for the implementation of health care reform.

The e-mail Brewer's office sent to reporters contained Schlomach's full post and her administration's responses:

Expanded Medicaid, Shrinking Wallets

By Byron Schlomach

The federal health care law included a provision asking all states to expand their Medicaid programs to cover all adults and children up to 133% of the federal poverty level. Right now, a little less than a fifth of the state's population is given free healthcare through Medicaid; if the state expands Medicaid nearly a fourth of Arizona's population would be covered.

Misleading. The expansion represents a minor change to Arizona's Medicaid eligibility, adding about 57,000 individuals above the level already mandated by Arizona voters. Even with this expansion, the Medicaid population will still be less than one-fifth of Arizona's population. Numbers aside, the bigger issue is whether we accept the current dynamic in which so many of our fellow Arizonans have no health insurance, receive Emergency Room care when they're sick or injured, and see their exorbitant costs offloaded onto the rest of us. This Hidden Health Care Tax amounts to nearly $2,000 per year for every Arizona family.

This expansion would cost a lot of money we don't have. Even with the federal government picking up most of the tab, estimates put the cost of expansion for Arizona at $125 million in 2016 alone. The yearly cost would rise as the federal share of the cost ratchets down to 90 percent. As the federal government's financial condition worsens, states will likely have to pick up even more of the cost.

False. The Governor's Medicaid Plan will employ hospitals to leverage federal dollars - guaranteeing there is NO COST to the State of Arizona General Fund. More than 30 states already use a similar mechanism to draw down federal Medicaid funds. Perhaps best of all: Governor Brewer's proposal will help alleviate Medicaid pressure on the General Fund, protecting critical state services such as education and public safety.

Governor Brewer wants a "circuit breaker" that will turn off the expanded program if the federal share ever fell below 80 percent. While the Supreme Court said states can't be compelled to expand Medicaid, it's an open question whether they can be compelled to continue an expansion once agreed to.

False. In a Dec. 10, 2012, letter to governors, HHS Secretary Kathleen Sebelius made it clear that states can choose whether and when to expand their Medicaid programs. And the letter clearly says any state may cancel its expansion at any time without endangering its remaining Medicaid funding. (see Question 25 -

If, in the future, the federal government insists that we keep expanded Medicaid coverage as a condition of keeping any Medicaid funds, we cannot count on our own state leaders to challenge that in court.

Misleading. Governor Brewer and other state leaders were united in challenging the Affordable Care Act all the way to the U.S. Supreme Court. Similarly, the Governor and legislative leaders would be willing to go to court once more in order to defend the authority of Arizona's elected officials to make financial decisions in the best interest of the State - just as they've done on other occasions.

After all, the Obama administration takes the position that Obamacare's expanded coverage of children is a valid mandate, in clear contradiction to the Supreme Court's decision. Still, state policymakers are doing nothing to challenge this position.

False. The Supreme Court's ruling did not change other Medicaid rules, and only made the expansion of low-income adults optional. Medicaid rules make it clear that the federal government CAN increase the minimum eligibility levels for mandatory populations, such as children.

But there's more at stake than dollars and cents. Expanding Medicaid means the state will participate in enforcing the health insurance mandate. After all, everybody is required to have health insurance, including Medicaid recipients, and the state will be put in a position of reporting when recipients drop off the Medicaid rolls.

False. The ACA DOES NOT require individuals to belong to Medicaid or purchase private insurance if their income is below the Federal Poverty Level or health premiums would exceed 8% of their income. As a result, restoring coverage for childless adults under Prop 204 and expanding eligibility up to 133% of the Federal Poverty Limit DOES NOT require Arizona to enforce the individual mandate since those individuals are EXEMPT from the mandate to start with.

Legislators who value fiscal prudence, the health of the state's future economy, and individual liberty should not support the expansion of Medicaid.

Legislators who value creating Arizona jobs, protecting Arizona health care and keeping Arizona tax dollars in Arizona should support the Governor's Medicaid Plan.