State working on adding 145,000 to Medicaid rolls

Minnesota is preparing to expand Medicaid coverage to another 145,000 people, including thousands of children.

"The whole promise of [health care] reform was built upon a promise of more coverage for more people," said Human Services Commissioner Lucinda Jesson, who testified before a Senate committee Wednesday about the next step of the massive federal health care reforms.

Gov. Mark Dayton's budget would expand the Medical Assistance program -- Minnesota's version of Medicaid -- to people who earn 138 percent over the current income limit. The expansion is expected to save the state $143 million, as the federal government picks up the tab for health care that the state, or local emergency rooms, now provide.

Expanding Medicaid "should be the easiest decision facing the Legislature this session," Jesson said, shortly before testifying in front of a Senate committee. Jesson was backed by a broad coalition of groups, ranging from the Chamber of Commerce to the AARP, that support the expansion.

Despite that support, some Minnesota physicians and hospitals have raised concerns about whether the state will be able to provide care to thousands of new Medical Assistance patients. It has been more than a decade since the state raised the fees it pays the providers who see these patients. The governor's proposed budget includes a request for an increase in those fees, but health care providers say they need more to care for this new population.

"Minnesota physicians have had their fee-for-service rates frozen for 13 years," Dr. David Thorson, chairman of the board of trustees for the Minnesota Medical Association, told senators.

Medicaid expansion is one of many moving parts in the health care reform debate at the Legislature. Few of those debates are likely to be easy.

The Legislature has until the end of March to create a health insurance exchange. The tight deadline means that the exchange bills -- massive, complicated documents that will create a complex health coverage network that will cost millions to set up and millions to run -- must speed through more than a dozen committees in less than two months.

Already, Republicans and some business groups are complaining that their concerns are being shoved aside in the interest of speed.

"It's being railroaded through," said Sen. Paul Gazelka, R-Brainerd, whose attempt to amend the Senate exchange bill to change its funding mechanism was tabled by the Commerce Committee on Wednesday. "It's a very, very complex issue, and it's going to be very expensive. The more time we take looking at each aspect, the better."

While the health exchange proposal does have Republican support, critics are worried about how the system will be funded, how it will operate and who will sit on the seven-member board that will oversee the marketplace and decide which insurance plans are available to the public. The Chamber of Commerce and groups representing the insurance industry, in particular, have voiced concerns about the exchange, which could become the insurance gateway for more than 1.3 million Minnesotans.