A Senate committee on Thursday learned that a bill proposing that the state collect a 3.5 percent fee on health insurance policies sold to Kansans on the federal government’s online marketplace could be used to force a vote on Medicaid expansion.
“I want to know if Senate Bill 309 could be a vehicle for Medicaid expansion,” Sen. Laura Kelly, a Topeka Democrat, asked in the final minutes of the Senate Ways and Means Committee hearing.
A representative of the Kansas Office of Revisor of Statutes said that, indeed, it could because the bill includes a reference to Medicaid, meaning that if the bill were to reach the Senate floor, amendments could be proposed that would force a vote on expansion.
The committee did not vote on the measure Thursday.
“It was just a hearing,” the committee’s chairman, Sen. Ty Masterson, a Republican from Andover, said afterward. “We can’t take a vote for 24 hours.”
Whether the committee votes on the bill, he said, is an open question. “I don’t know,” Masterson said. “We’ll see what (committee members) are thinking next week.”
The Senate later adjourned for the rest of the day and Friday, sidestepping a much-anticipated debate of a proposed plan for closing a more than $400 million gap in the state budget. The Senate and House will reconvene Tuesday.
Throughout this year’s legislative session, conservative leadership in the Republican-controlled House and Senate has quashed Democrat-led efforts to force a vote on Medicaid expansion.
Expansion would make all Kansans with incomes up to 138 percent of the federal poverty level eligible for Medicaid. For 2015 that’s annual income of $16,105 for an individual and $32,913 for a family of four.
The federal government will cover all costs of expansion through 2016. After that, states will be responsible for no more than 10 percent of the cost and the federal government will pay the remainder.
After the hearing Thursday, Kelly said she’d let Masterson know that if “they work this bill, they can expect that Medicaid expansion will come up in committee and again on the (Senate) floor.”
Rep. Jim Ward, a Wichita Democrat who’s leading Medicaid expansion efforts in the House, said the bill, if adopted by the Senate, would encounter a similar reaction in the House.
“Absolutely, an amendment will be made to expand Medicaid.” Ward said. “That’s a much better idea than raising taxes on people who are buying insurance on the exchange either because they couldn’t get anybody to sell it to them or, now, they can’t afford without the subsidies that are in Obamacare.”
Senate Bill 309, introduced Tuesday on behalf of Sen. Mary Pilcher-Cook, a Republican from Shawnee and chairwoman of the Senate Public Health and Welfare Committee, would allow the state to collect a 3.5 percent fee on health insurance policies sold on healthcare.gov, the federal government’s online health insurance marketplace.
Testifying before the committee, Pilcher-Cook said the proposed fee would generate between $18 million and $24 million annually that would be used to offset some of the costs associated with state’s Medicaid program and its implementation of the Affordable Care Act, also known as Obamacare.
In legislative circles, Pilcher-Cook is well-known for her opposition to the Affordable Care Act.
“Obamacare is continually taking away more and more of Kansans’ freedoms,” she said.
In Kansas, three companies sell plans on the state’s federally administered online marketplace: Coventry and Aetna Health Company, Blue Cross and Blue Shield of Kansas City and Blue Cross and Blue Shield of Kansas.
Representatives from all three companies testified against the measure, assuring committee members that the fee would be passed on to consumers, would force a 3.5 percent increase in non-marketplace plan premiums and could lead to fewer companies participating in the marketplace.
“This tax is not necessary and is going to hurt consumers,” said Vernon Rowen, vice president for state government affairs with Coventry and Aetna Health Company.
Two of the committee’s 11 members — Sen. Steve Fitzgerald of Leavenworth and Sen. Jeff Melcher of Leawood, both Republicans — indicated they were likely to support the bill.
But the committee’s vice chairman, Sen. Jim Denning, a Republican from Overland Park, said he doesn’t expect the committee to vote on the bill this year.
“We’re out of time, and this is much too big of a deal to rush through,” he said.
Still, he said, the issues surrounding the increased costs associated with implementation of the Affordable Care Act are real and need to be addressed.
“This isn’t going away,” Denning said. “We’ll be having this discussion next year.”
Dave Ranney is a reporter for KHI News Service in Topeka, a partner in the Heartland Health Monitor team.
