Thursday, February 13, 2014

A Message From My State Senator



I just thought you folks might like to see the e-mail I received today from my state senator, John Watkins. A RINO in the Eric Cantor mold.

February 13, 2014

It's Not Medicaid . . . It's Marketplace Virginia

This week it seems that every time you pick up a newspaper there is a story with regard to healthcare and how Virginia will respond on that topic.  Another subject I saw and can most certainly guarantee that you saw in print, or on a mobile app, everyday last week was Medicaid expansion. 

Of the people who visit, call, or write me - constituents, lobbyists, political activists, or citizen groups-rarely is anyone neutral on Medicaid expansion.  They either love it or they hate it.  

What we can all agree on, however, is that there is a problem that needs a commonsense solution -- for the one in eight Virginians who are uninsured, including 37,000 veterans and their families, and for taxpayers, who are already paying for this program through their payroll deductions, to receive some return on their contributions.

The primary argument against a new healthcare plan is that the federal government cannot be counted on to hold up its part of a very good bargain for Virginia, full federal funding of the costs for the next three years and no less than 90 percent after that.

If that were true, then why would we accept any federal funding because someday Congress may reduce or eliminate that funding?  Would we need to radically rethink our budget planning process for a number of programs, systems and projects? 

It might surprise you to know that more than 21 percent of Virginia's revenue comes from the federal government, according to reports from the Commonwealth Institute for Fiscal Analysis.  For instance, Virginia's investments in education depend on federal dollars.  In 2015, the Commonwealth is banking on more than $900 million, the vast majority of which will go directly to our schools.

We rely on more than $140 million in federal funds to support public safety across the Commonwealth.  That's money for the state police, our courts, and the Virginia National Guard.

We also make heavy use of federal funding for our transportation system.  In the last fiscal year, Virginia received almost $1.1 billion - that's billion with a "B" - most of which will be used for highway maintenance and construction.    And that is in addition to the funding that will be raised thanks to the transportation plan that passed in last year's session.

So .... if we were to assume that all federal monies were subject to cancellation and therefore not to be solicited or accepted, you can imagine the havoc it would play with our education, public safety, transportation, courts, environmental and other portions of our budget.

The question then becomes, when is it effective and beneficial to accept federal funding and when is it an unacceptable option?  I don't think anyone reading this message would think we should do without funding for police officers, our courts, our roads, and especially our schools.  Then why would we not accept federal funds to ensure the provision of adequate healthcare to all Virginians? 

Healthcare is extraordinarily important to all of us, and to future generations.  We need to come up with a solution, but we must strive to get it right.  

As a part of the Medicaid Innovation and Reform Commission I learned that over the last decade the Commonwealth has spent more than $1.2 billion - again, that's billion with a "B" - in subsidizing the cost of indigent care at VCU Health System, UVA Medical Center and private hospitals.  That figure includes $137 million in FY 2013 alone.  Then add to that up to another $2 billion, from a hidden tax you pay as a part of your health insurance.

The Marketplace Virginia program would create the Virginia Taxpayer Recovery Fund to recapture no less than $1.7 billion each year from revenues flowing to Washington, D.C. from Virginia businesses and citizens.  Each day we hesitate Virginians are sending $4 to $5 million to Washington as a result of additional payroll taxes, insurance premium taxes, and business fees that are a result of the federal law. 

Because I believe Virginia knows better than Washington how to address this dilemma, working with the Senate Finance Committee I have sponsored the initiative called Marketplace Virginia.

A private sector, managed-care model, Marketplace Virginia will put a pro-business stamp on coverage, while recapturing no less than $1.7 billion each year from revenues flowing to Washington D.C., from Virginia businesses and citizens.  The fund would provide premium assistance for uninsured Virginians so they can take responsibility for their own health care decisions. 

Not a give-away initiative, it would require "skin in the game" including contributions up to five percent of their household income designed to encourage use of primary care and prevention, and discourage inappropriate use of emergency room care. 

The benefits of having this Marketplace would include additional funding for behavioral health; meaningful general fund savings; and improved access, better outcomes and reduced costs for the thousands of Virginians now without healthcare coverage.

No plan in the world, however, comes without some risk, cost considerations and skepticism . . . the primary risk being that Uncle Sam reneges on its financial commitment. 

Three contingencies are included under Marketplace Virginia in order to protect the integrity of the budget process should the federal government fail to keep its promise:

First, Virginia participants would be notified UP FRONT that the program is contingent upon financial commitments from the federal government, and notified that the program would be discontinued should the federal government renege. 

Secondly, discontinuation of the program if the federal government reneges.

And finally, the plan requires private insurers to notify participants of program changes. 

With regard to cost, the Commonwealth Institute for Fiscal Analysis reports that whatever form expanding coverage takes, whether it is a straight up expansion or the premium assistance/private option, it will save Virginia money in the form of less state funding for the uninsured through uncompensated care, community-based mental health and substance abuse services, prisoner health care, etc. 

I believe that reinvesting these dollars will offset the cost that all Virginians pay, directly or indirectly, to subsidize the cost of providing indigent care.

Skeptics say that a waiver from the federal Department of Health and Human Services would be required to establish Marketplace Virginia.  They go on to say they are issued on a limited basis and only through the end of 2016, when they would be re-evaluated and then replaced by a longer-term state innovation waiver, the terms of which are not presently known.

I and others believe there is no doubt Virginia could get a waiver.  The elements included in my legislation on how Marketplace Virginia would work are comparable to and have already been included in other states' applications.   

Rather than a two-year span, the states are usually granted a five-year initial term.  When the original waiver is set to expire, Virginia would submit a renewal or ask for an extension to continue operations.  Extensions are typically for a three-year period.  Furthermore, some waivers have been renewed several times, allowing operations to continue for several more years. 

Just because it is done through a plan waiver doesn't change the fact that the expansion is still optional and the state can back out after the end of the initial period.  Expanding via a private exchange absolutely does not "lock-in" the state any more than expanding via the traditional route of expanding Medicaid.  Federal law clearly ALLOWS states that close the coverage gap to return to their original coverage limits at any time. 

The federal government has cooperated with these types of efforts, issuing waivers to states with reasonable coverage plans, and I am confident Virginia would be successful in its application for a private exchange.

I believe it is time to make use of what is, after-all, our money, to expand the availability of healthcare coverage for some of our most vulnerable fellow citizens, friends and neighbors.  




P.O. Box 159

Midlothian, VA 23113

Phone: (804) 379-2063

Fax: (804) 794-7238