Lawmakers won’t move Medicaid expansion oversight to state

April 9, 2019

BISMARCK, N.D. (AP) — Gov. Doug Burgum has not convinced lawmakers that a state agency can do a better job of administering North Dakota’s Medicaid expansion program.

A House appropriations subcommittee that reviews human services spending failed to endorse the idea on Tuesday, mirroring what the Senate had done earlier. The first-term Republican governor pitched the idea in his state-of-the-state address in January, saying handling the Medicaid expansion program in-house would be more efficient and less costly. Burgum said savings to the program would be reinvested in other health initiatives.

The idea has drawn intense opposition from lobbyists representing the state’s biggest hospital group and Dakotas-based Sanford Health, the company providing coverage for North Dakota’s Medicaid expansion.

GOP Rep. Jon Nelson heads the House subcommittee and was one of only two lawmakers to endorse Burgum’s idea of moving the Medicaid expansion program in-house. Nelson said the health care providers are “making a profit off this population or they wouldn’t be fighting so hard to keep it.”

Tim Blasl, president of the North Dakota Hospital Administration, said he doesn’t believe the state has the resources to take on the program. His group also estimated the switch would mean a $220 million cut to health care providers in the state, due to lower reimbursement rates, if the state runs the program.

About 20,000 people are enrolled under the state’s Medicaid expansion, a component of the federal Affordable Care Act championed by former President Barack Obama. Another 70,000 North Dakotans are enrolled in traditional Medicaid, a program that provides medical treatment for the poor.

Chris Jones, director of the state Department of Human Services, said the state already administers the traditional Medicaid program and it wouldn’t be difficult adding the expansion component to it.

“This is just adding another 20,000 people — that’s all it is,” Jones said.

The federal government funds 90% of Medicaid expansion, with the state matching 10%.

Jones said the state’s Medicaid expansion program costs more than two times the national average. Shifting to in-house administration would lower the costs to roughly one-and-a-half times the national average and equal to what the traditional Medicaid program costs at present, he said.

The House subcommittee did pass an amendment that would move prescription drug programs in the Medicaid expansion under control of the state. But an amendment to levy a 1% surcharge on some health care providers to help offset government costs failed.

House and Senate budget writers still must agree on the entire Health and Human Services budget, which makes up a about a third of all state spending.