Congresswoman Shea-Porter - Lynch: Health reform a wash for N.H.

Lynch: Health reform a wash for N.H.
The Telegraph of Nashua

Saturday, March 27, 2010 8:12 AM EDT

CONCORD — The Lynch administration concluded the long-term impact of the federal health care reform law will be revenue neutral for New Hampshire, officials said Friday.

The reconciliation bill the Congress passed late Thursday increased federal support in expanding eligibility for Medicaid, the federal-state health insurance program for low-income residents, the disabled and some senior citizens.

Over time, the ranks of those on Medicaid in the state will grow by 62,000 for about a 50 percent jump over the current enrollment of 115,000.

“We are saying long term it looks to be revenue neutral for us,” said Colin Manning, press secretary to Gov. John Lynch. “It appears that in reconciliation a lot of the governor’s concerns were addressed.”

In the short-term, New Hampshire’s budget should get an $8 million benefit next year in health insurance costs for state retirees who are younger than 65 years old, officials said.

Lynch, a three-term Democrat, had been one of a half-dozen governors in his own party who declined to endorsed health care reform and warned it could shift costs to states.

Lynch worked with the state’s congressional delegation and other governors to ensure federal support was boosted in the second of two health care reform laws, Manning said.

“This clearly looks like a bill New Hampshire can live with,” Manning said.

Lynch Deputy Chief of Staff Pamela Walsh said state health agency experts conclude that by 2020 the range of impact is between a $9 million-a-year cost to an $8 million-a-year savings.

“It really can only be expressed in a range because there are built-in assumptions, and we’re looking 10 years out,’’ Walsh said.

The health bill expands eligibility for Medicaid but the federal government picks up 100 percent of that cost through 2016, Walsh said.

After that point, the federal share drops to 95 percent in 2017 and 90 percent in 2020.

“The reimbursement support in the final bill is an improvement,’’ Walsh said.

The state estimates are that additional costs for Medicaid expansion will reach $43 million by 2020 but savings estimates can run as high as $45 million by that time, Walsh added.

Republican candidate for governor John Stephen, a health care consultant, said the reconciliation bill is worse for New Hampshire and attacked Lynch’s refusal to come out against the new law.

“This reconciliation bill actually does more damage and sooner to New Hampshire’s budget than the law the President signed did,” Stephen said in a statement. “While this legislation got rid of the ‘Cornhusker Kickback,’ it added the ‘Granite State Slapdown.’ Governor Lynch cannot continue to stay silent while this law that threatens to blow a giant hole in our budget and hurts New Hampshire disproportionately moves forward. He needs to get in the game.”

Stephen claimed the new law puts at risk so-called Medicaid Enhancement Revenue that contributed $99 million to the budget this year and $114.6 million next year.

Unlike most states, these payments do not go to health care providers but to the New Hampshire treasury, Stephen noted.

Stephen ran the state’s Medicaid Program while serving as commissioner of the Department of Health and Human Services.

“This is Governor Lynch’s last chance to speak out against this legislation in order to protect New Hampshire’s taxpayers,” Stephen said. “This reconciliation bill accelerates by three years the fiscal train wreck on the state budget that the federal health reform will cause.’’

Walsh said there is a cap on Medicaid enhancement revenue starting in 2014 and across the country it equals about a 20 percent cut.

But the law gives federal health officials broad authority to draw up rules in the coming years.

“Until you see the rules and how it is done, we won’t know the impact on New Hampshire,’’ Walsh explained.

“Obviously that is an issue we are gong to be watching very closely. It would be hard to conclude at this point that funding is going away altogether.”

Democratic Party leaders have criticized Stephen’s stewardship of the Medicaid enhancement revenue program, citing a federal audit covering Stephen’s tenure as Health and Human Services commissioner. The audit has tentatively ordered the state to repay $35 million in excess New Hampshire Medicaid enhancement revenue payments to the federal government.