Conservative groups see chance to kill Medicaid expansion in Montana

Conservative groups are working to undermine support for Montana’s Medicaid expansion in hopes that the state will abandon the program. The rollback would be the first in a decade since the Affordable Care Act began allowing states to cover more low-income people.

The Montana extension, which provides approx 78,800 peopleit is set to expire next year unless the Legislature and the governor decide to renew it. Opponents see a rare opportunity to eliminate the Medicaid expansion in one of the 40 states that approved it.

The Foundation for Government Accountability and the Paragon Health Institute, think tanks funded by conservative groups, told Montana lawmakers in September that the program’s enrollment and costs are high and that the overburdened system hurts access to care for the most vulnerable.

Manatt, a consulting firm that has studied Montana’s Medicaid program for years, then presented lawmakers with the opposite idea, saying more people are getting access to critical care because of the Medicaid expansion. Supporters of the program say the conservative groups’ arguments are flawed.

Rep. state Rep. Bob Keenan, a Republican who chairs the Interim Health and Human Services Budget Committee, which heard the dueling arguments, said the decision to kill or continue the Medicaid expansion “comes down to who thinks what.”

The expansion program extends Medicaid coverage to adults with incomes up to 138 percent of the federal poverty level, or nearly $21,000 a year for a single person. Before, the program was mostly reserved for children, people with disabilities and pregnant women. The federal government covers 90 percent of the expansion cost, while the states pick up the rest.

National Medicaid researchers said Montana is the only state considering suspending its expansion in 2025. Others could follow.

New Hampshire lawmakers in 2023 extended the state’s expansion by seven years and this year blocked legislation to make it permanent. Utah has provisions to reduce or end its Medicaid expansion program if federal contributions fall.

FGA and Paragon have long advocated against Medicaid expansion. Tax records show their funders include some large organizations that promote conservative agendas. That includes Fund 85, which is backed by Leonard Leo, a conservative activist best known for his efforts to fill the courts with conservative judges.

The president of the Paragon Health Institute is Brian Blase, who served as a special assistant to former President Donald Trump and is a visiting member of the FGA, who quotes him as praising the organization for its “conservative policy wins” in all states. It was also announced in 2019 as a visiting colleague at the Heritage Foundation, which was behind the president’s Bill 2025, which proposes to restrict Medicaid eligibility and benefits.

Paragon spokesman Anthony Wojtkowiak said its work is not driven by any political party or donor. He said Paragon is a non-partisan non-profit organization and responds to policy makers interested in learning more about its analysis.

“In Montana’s case, Paragon has no role in the Medicaid expansion debate other than to testify,” he said.

The FGA declined an interview request. The organization started already last year calling Montana lawmakers to deny program reauthorization. Also released a video This year, Montana Republican Rep. Jane Gillette said the state should allow its expansion to expire.

According to Keenan, Gillette requested the FGA and Paragon presentations to state lawmakers. He said Democratic lawmakers responded by calling for Manatt’s presentation.

Manatt’s research was contracted by the Montana Healthcare Foundation, whose mission is to improve the health of Montanans. Its latest report also received support from the state hospital association.

Montana Healthcare Foundation is a funder of KFF Health News, an independent national newsroom that is part of the nonprofit health information organization KFF.

Bryce Ward, a health economist in Montana who studies Medicaid expansion, said some of the arguments against the expansion don’t add up.

For example, Hayden Dublois, FGA’s director of data and analytics, told Montana lawmakers that in 2022, 72 percent of able-bodied adults in Montana’s Medicaid program were not working. If that data refers to adults without disabilities, that would come to 97,000 Medicaid enrollees without jobs, Ward said. He said it was just shy of the state’s total population that didn’t report any income at the time, most of whom didn’t qualify for Medicaid.

“It’s just not plausible,” Ward said.

A Manatt report, citing federal survey data, showed that 66% of Montana adults on Medicaid have jobs and another 11% are in school.

The FGA did not respond to a request for its data, which Dublois said in the committee hearing came through a state records request.

Jon Ebelt, a spokesman for the Montana Department of Public Health and Human Services, declined to comment. As of late October, a KFF Health News records request for data provided by the state to FGA was pending.

In his presentation to Montana lawmakers, Blase said the most vulnerable people on Medicaid are worse off because of the expansion as resources go to new enrollees.

“Some people got more medical care; some people got less medical care,” Blase said.

Reports issued by the state show the standard monthly reimbursement for each Medicaid enrollee remained relatively flat for seniors and blind or disabled adults.

Drew Gonshorowski, researcher at Paragon, cited data from a federal Medicaid commission showing that states generally spend more on adults who qualified through the expansion programs than others on Medicaid. This data also shows that states spend more on seniors and people with disabilities than on the broader Medicaid-insured adult population, which is also true in Montana.

Nationally, expansion states spend more money on Medicaid enrollees across eligibility groups compared to non-expansion states, according to a KFF report.

Zoe Barnard, a senior counsel for Manatt who has worked for the Montana health department for nearly 10 years, said not only has the state’s uninsured rate dropped 30 percent since expanding Medicaid, but some health services specialty have grown as more people have access to care.

FGA has long lobbied for non-expansion states, including Texas, Kansas and Mississippi leave Medicaid expansion alone. In February, an FGA representative testified in support of an Idaho bill that included a trigger to repeal the expansion if the state couldn’t meet a set of rules, including instituting work requirements and capping enrollment. The bill failed.

Paragon produced an analysis titled “Resisting the wave of Medicaid expansion”, and Blase testified before Texas lawmakers this year for the value of maintaining expansion outside the Lone Star State.

At the federal level, Paragon recently proposed a Medicaid overhaul plan to phase out the 90 percent federal match rate for expansion enrollees, among other cost-cutting changes. The left-leaning Center on Budget and Policy Priorities countered that such ideas would leave more people without care.

In Montana, Republicans are defending a supermajority they didn’t have when a bipartisan group approved the expansion in 2015 and renewed it in 2019. Also, unlike before, there is now a Republican in the governor’s office. Gov. Greg Gianforte is running for re-election and said the safety net is important but shouldn’t get too big.

Keenan, the Republican lawmaker, predicted the expansion debate will not be clear when lawmakers convene in January.

“Medicaid expansion is not a yes or no. It will be a negotiated decision,” he said.