Dueling reports on the healthcare reform law's impact on states surfaced Tuesday as governors testified on Capitol Hill.

A new bicameral report from Republicans on the Senate Finance and House Energy and Commerce panels estimated that the law's Medicaid expansion would cost $118 billion over 10 years, almost twice the Congressional Budget Office's score. Simultaneously, the Robert Wood Johnson Foundation issued a report saying states would get $82.3 billion from the federal government in Medicaid and state exchange subsidies.

The new Medicaid enrollees, the foundation's report says, "have lower associated costs because, on average, they do not have the same health issues" as previous beneficiaries.

The bicameral report, meanwhile, warned about future costs to states because of the expansion of Medicaid to more than 15 million people, starting in 2014.

President Obama’s Medicaid chief shot down a proposal gaining traction among Republican governors to transform Medicaid into block-grant payments as the states face mounting costs running the healthcare program for poor individuals.

As states are facing massive budget deficits, more than half of the nation’s governors are looking for relief from a requirement in the new healthcare reform law to maintain Medicaid eligibility through 2014. Many Republican governors are pushing for Medicaid block grants, instead of a federal match, because they say it would provide them with the maximum flexibility to address budget shortfalls while ensuring the healthcare safety net remains in place for low-income individuals.

However, Centers for Medicare and Medicaid Services Administrator Don Berwick, stressing his support for states' flexibility, told reporters on Tuesday that block grants aren’t on the table.

“I think we need to make sure that Medicaid beneficiaries get access to the kind of care that could really help them them, and I think we’ll be open to ideas, but block grants are not something” the administration would support, Berwick told reporters at the Federation of American Hospitals (FAH) conference.

When pressed for an explanation of why the administration opposes block grants, Berwick declined.

“That’s all I have to say about that right now,” he said.

Republican Govs. Haley Barbour (Miss.) and Gary Herbert (Utah) urged Congress Tuesday to press for the Supreme Court to quickly resolve the legal challenges against the healthcare reform law.

"We already have conflicting opinions at the district court level," Barbour said. "Conflicting decisions from different circuits would just compound the problem. So, for those of you who have any influence on that, we would like to have that question answered sooner rather than later."

"Speaking for Utah, it's kind of like we're sitting on shifting sands," Herbert said, adding that as more time passes it's going to be increasingly difficult to determine which elements of implementation would need to be unwound if the whole law is struck down. "The uncertainty is really a problem for us, to know which way to go and what to do."

The governors made the remarks while testifying in Congress about the healthcare reform law's costs to the states.

Three federal district judges have ruled that the law's individual mandate is constitutional, while two have struck it down. One of those judges, Florida's Roger Vinson, ruled Jan. 31 that the whole law is unlawful because the mandate is central to its functioning.

The White House has appealed the adverse rulings to two appeals courts rather than asking the Supreme Court to review the contradictory rulings in an expedited manner. At that rate, Rep. Michael Burgess (R-Texas) said, it could be June 2012 before the Supreme Court rules.

The Obama administration has also asked Vinson to clarify whether he meant to freeze implementation of the law with his ruling.

Vinson could rule as early as today. If he declares that implementation should stop until higher courts rule, the administration is almost certain to seek a stay.

This post was updated at 12:20 p.m.

The top Republicans dealing with healthcare policy in the House and Senate released a report Tuesday that estimates the cost of the healthcare reform law's Medicaid expansion at $118 billion - almost twice the Congressional Budget Office's estimate.

The bicameral report comes as three governors prepare to testify Tuesday morning before the Energy and Commerce Committee about the program's impact on their state budget. The report, titled 'Medicaid Expansion in the New Health Law: Costs to the States', contains a state-by-state analysis of the law's financial impact.

"Governors of both political parties were clear when Congress was debating the $2.6 trillion health law that they could not afford a massive expansion in Medicaid," said Senate Finance Committee ranking member Orrin Hatch (R-Utah). "Washington didn't listen and plowed forward instead by putting 16 million Americans onto the Medicaid rolls to keep the federal price tag down.

President Obama is backing a plan that would allow states to opt out earlier from the requirement to buy insurance.

The states who successfully challenged the healthcare reform law in a Florida federal court should not have expected the judge to halt the law’s implementation because their challenge addressed a very small portion of the law’s provisions, the Obama administration argued on Monday.

Further, the federal judge who overturned the entire law never gave any specific direction for halting the law, so the 26 states and the business group that successfully challenged the law had no reason to anticipate the law would be stopped, the administration wrote in a court filing Monday night.

The administration’s plea to continue implementation of the law came a week after it asked U.S. District Judge Roger Vinson to clarify his ruling that the entire law is unconstitutional. Vinson, a President Reagan appointee, declared the law’s requirement for individuals to purchase insurance is unconstitutional and said the whole law is unconstitutional because the provision cannot be separated without wrecking the entire healthcare overhaul's design.

Following the Jan. 31 ruling, a handful of states asserted that Vinson meant to halt the law’s implementation, and even Democratic lawmakers said they were unsure about the intent of Vinson’s ruling.
Read more...

After months of hearing Republican governors complain about the healthcare reform law, President Obama challenged all of the nation's governors to come up with their own healthcare proposals on Monday.

Speaking to the state leaders, Obama threw his support behind a bipartisan Senate bill that would accelerate the reform's waivers for states that want to try innovative healthcare programs that offer coverage as expansive and affordable as it is under the healthcare law. The waivers, which would be start in 2014 instead of 2017, would give the states the chance to propose alternatives, including options to replace the unpopular individual mandate. Read The Hill story.

House GOP hates it: House Republicans, eager to undo the law, labeled the president's announcement an admission of the law's failure. "It is just making our point that not only have we seen a variety of exceptions and waivers issued to the private sector under the act but now we’re seeing how that act is troubling states in a real way," House Majority Leader Eric Cantor (R-Va.) told reporters Monday.

Liberals say President Obama’s support for accelerating state waivers for the healthcare reform law creates new opportunity for the federal government to back more liberal healthcare policies rejected during past debate over the reform law.

Obama on Monday endorsed a Senate bill that allows states to seek earlier exemptions from the reform law in order to build their own healthcare systems that meet the law’s coverage and affordability goals. The federal law currently provides the waiver option in 2017, but Obama is backing a bill from Sens. Ron Wyden (D-Ore.), Scott Brown (R-Mass.) and Mary Landrieu (D-La.) that would move the date up to 2014.

The original healthcare reform bill included a public-option insurance plan to compete with the private market, but it was dropped months before the final law passed. Consumer Watchdog said the accelerated waiver program gives liberal states the leeway to implement more progressive reforms.

“State waivers give progressive reformers in California and elsewhere the ability to move forward on ambitious reform plans that can pass at the ballot box in 24 states but would never get the time of day in Washington,” Consumer Watchdog President Jamie Court said in a statement.

President Obama on Monday told the nation's governors he wants to hear all their ideas about ways to reform Medicaid, their No. 1 budget buster.

Obama invited the state executives to the White House and proposed they create a bipartisan group to negotiate with the Department of Health and Human Services (HHS). The governors are in town for the winter meeting of the National Governors Association.

"If you can come up with more ways to reduce Medicaid costs while producing quality care to those who need it, I will support those proposals," Obama promised.

A senior administration official told reporters after the meeting that the White House hopes the bipartisan commission will focus on issues such as coordinating care, preventing hospital readmissions and trying to keep people out of nursing facilities if they'd rather stay in their own homes.