DFL legislators announced a plan Thursday to keep offering state-subsidized health care to low-income adults, even though Gov. Pawlenty vetoed funding for it.
Coverage under General Assistance Medical Care is scheduled to end in less than three months. But the plan unveiled Thursday would provide a temporary extension of coverage for an estimated 35,000 enrollees.
Pawlenty cut funding for GAMC earlier this year as part of his solution to the state budget deficit. With the remaining funds expected to run out March 1, state officials are planning to switch current GAMC enrollees to the MinnesotaCare program, which is primarily funded through the state's Health Care Access Fund.
Sen. Linda Berglin, DFL-Minneapolis, who chairs the Senate Health and Human Services Budget Division, says the state can't afford that switch.
"The Health Care Access Fund doesn't have the money to do this," she said. "If we auto-enroll these people in MinnesotaCare, we're spending money we don't have."
Bergin and other Democrats are instead proposing a 16-month extension of GAMC funding, that they insist will use existing money and not increase taxes. Their plan relies largely on a Medicaid surcharge for hospitals and HMOs, reduced payments to doctors, clinics and hospitals and counties picking up 10 percent of the cost.
Berglin says the proposal would end eligibility for some people, including county jail inmates and pregnant women, who could get coverage under Medicaid.
"This is a proposal that is paid for. It is not an ideal proposal, but it puts real money into this program to continue it over the next 16 months," said Berglin.
At a State Capitol news conference, DFL legislators tried to put a face on the problem by introducing Al Phenow, 60, a former construction worker from Osseo. Phenow said he faces an uncertain future, because he was counting on his GAMC coverage to pay for hip replacement and a new pacemaker.
"They say it would be turned over to MinnesotaCare, and they have a cap of like $10,000, I believe," said Phenow. "That wouldn't even pay for one of my surgeries. So, I guess I would be out of luck."
DFL legislators say their plan will serve as a bridge to the national health care reform they expect to see finalized in the coming months.
Rep. Tom Huntley, DFL-Duluth, chair of House Health Finance Division, said the GAMC plan follows the lead of federal legislation by creating what's known as Accountable Care Organizations.
"What this does is allows counties to become an Accountable Care Organization, which means we give them a fixed amount of money, hold them accountable for results, but let them figure the best way to spend it," said Huntley. "Hennepin County Medical Center is ready for that. They want to do that."
Huntley and Berglin say they think Pawlenty can support their plan, but the Republican governor wasn't opening his arms.
During a conference call from his trade mission in South America, Pawlenty said he wasn't sure the DFL plan was even financially viable. He was particularly concerned about the proposed Medicaid surcharge.
"We don't need to be, and shouldn't be, increasing taxes on health care and driving up those costs further," said Pawlenty. "They would argue that some or all of that gets reimbursed by the federal government. We need to look into that in much more detail."
Rep. Matt Dean, R-Dellwood, has some reservations as well. Dean said he wants to focus legislation on patients, not a program. He's also questioning the surcharge.
"It's not spread very thin, and hospitals are really hurting right now, so I'm a little concerned," said Dean. "I want to talk to hospitals and see how it's going to effect them. Also, will they have more uncompensated care as a result of this?"
Lawmakers will begin formal hearings on the DFL plan next week. The goal is to have a bipartisan agreement ready for passage in the opening week of the 2010 Legislative session, which begins Feb. 4. That's less than a month before funding for GAMC is set to expire.