Montana Faces Critical Decision on Medicaid Expansion Renewal

Conservative groups aim to end Montana's Medicaid expansion, which insures about 78,800 people, arguing it's costly.
Conservative groups see chance to kill Medicaid expansion in Montana

Conservative organizations are actively seeking to end support for Medicaid expansion in Montana, aiming for the state to discontinue the program. This move could mark the first reversal since the Affordable Care Act allowed states to expand coverage for low-income individuals.

Montana’s Medicaid expansion, currently providing coverage to 78,800 residents, faces expiration next year unless state leaders renew it. Opponents view this as a unique chance to terminate Medicaid expansion in one of the 40 states that have embraced it.

The Foundation for Government Accountability and Paragon Health Institute, both conservative-funded think tanks, presented arguments to Montana lawmakers in September, claiming the program’s costs and enrollment are excessive, impacting care access for the vulnerable.

Conversely, Manatt, a consulting firm with extensive research on Montana’s Medicaid, reported expanded access to essential treatment due to the program. Supporters argue that the criticism from conservative groups lacks substantiation.

Republican State Rep. Bob Keenan, chair of the Health and Human Services Interim Budget Committee, which heard the contrasting views, stated the decision hinges on differing beliefs.

The expansion covers adults earning up to 138% of the federal poverty level, or about $21,000 annually for an individual. Initially, Medicaid mainly served children, people with disabilities, and pregnant women. The federal government funds 90% of expansion costs; states cover the rest.

Montana appears to be the only state contemplating a rollback of Medicaid expansion in 2025, though others might follow. New Hampshire recently extended its expansion for seven years, while Utah has provisions for scaling back if federal aid decreases.

FGA and Paragon, known for opposing Medicaid expansion, are funded by groups with conservative agendas, including the 85 Fund, linked to activist Leonard Leo. Brian Blase, Paragon’s president, served under former President Trump and is a visiting fellow at FGA, which he lauds for achieving conservative policy success.

Paragon’s spokesperson Anthony Wojtkowiak stated the group’s work is nonpartisan, responding to policymakers interested in its analyses. In Montana, Paragon’s involvement was limited to testimony.

FGA declined an interview but has advocated against renewing the program since last year, even releasing a video featuring Montana Rep. Jane Gillette opposing the expansion’s continuation.

According to Keenan, Gillette requested presentations from FGA and Paragon. Democratic lawmakers responded with a request for Manatt’s presentation. Manatt’s study was commissioned by the Montana Healthcare Foundation to improve health outcomes in the state.

Economist Bryce Ward criticized the anti-expansion arguments, pointing out flaws in claims about jobless Medicaid enrollees. He argued that the data presented doesn’t align with the state’s population statistics.

A Manatt report, referencing federal data, indicated that 66% of Montana’s Medicaid recipients are employed, while another 11% attend school.

FGA didn’t provide its data, and a request for state-supplied information remains pending. In his legislative presentation, Blase asserted that Medicaid expansion diverts resources from the most vulnerable.

State reports show stable reimbursements for senior and disabled Medicaid enrollees, though federal data suggests higher spending on expansion adults compared to pre-existing enrollees.

Nationally, expanded states spend more per enrollee across eligibility groups compared to non-expansion states, according to a KFF report.

Zoe Barnard from Manatt noted Montana’s uninsured rate dropped by 30% post-expansion, with increased access to specialty services.

FGA has promoted non-expansion in states like Texas and Kansas. It supported an Idaho bill for expansion repeal tied to work requirements, although the bill failed.

Paragon released an analysis titled “Resisting the Wave of Medicaid Expansion.” Blase testified in Texas on the benefits of avoiding expansion.

Paragon also proposed a federal plan to reduce the 90% match for expansion enrollees, countered by the Center on Budget and Policy Priorities for potentially increasing uninsured rates.

In Montana, Republicans enjoy a supermajority absent during the bipartisan expansion approval in 2015. With a Republican governor now, the debate on Medicaid expansion is expected to be complex, as noted by Keenan, who anticipates a negotiated outcome.

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