Nebraska governor says state cannot afford Medicaid expansion

Wed Jul 11, 2012 1:33pm EDT

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(Reuters) - Nebraska Governor Dave Heineman said on Wednesday the state cannot afford the expansion of the Medicaid program under President Obama's healthcare law, but stopped short of saying whether the Midwestern state would join six others rejecting the expansion.

Heineman, a Republican, said in a letter to senators Wednesday that the expansion would force Nebraska to cut funding for education.

The U.S. Supreme Court ruling on the health care law gives states the choice of opting out of the expansion. Republican governors in six states - Texas, Florida, South Carolina, Wisconsin, Mississippi and Louisiana - have said they will not implement the expanded coverage for low-income uninsured people, a key part of President Barack Obama's signature law.

Heineman said he would not be sending the state health director to a meeting called by Nebraska senators for Thursday because it is an organizational meeting with advocacy groups that support an expansion of Medicaid.

"My position is very clear - Nebraska can't afford an unfunded Medicaid expansion," Heineman wrote. He said the expansion would cost the state hundreds of millions of dollars.

Under the health law, the federal government would fund 100 percent of the expansion in the first three years, declining gradually to 90 percent thereafter.

State Senator Jeremy Nordquist, a Democrat who was among the group of senators that called the meeting, said it is "unfortunate" the governor is not willing to have a "serious bipartisan policy discussion." Nordquist said the meeting would include "pretty much every stakeholder in Nebraska."

"It's nothing new for the governor to play politics - he continues to bury his head in the sand," Nordquist said. He added that if the governor did decide to opt out of the expansion, he believed the state's legislature could override him, as it did in overriding the governor's veto of a proposal to provide prenatal care to illegal immigrants.

The U.S. Supreme Court last month upheld as constitutional the health care law's individual mandate, which demands everyone who can afford to buy health insurance does so or pays a fine.

But the court said Congress went too far in the part of the law that requires states to expand Medicaid, the federal-state health insurance program for low-income people. The court said the federal government may not take away Medicaid dollars from states that do not comply with the expansion.

(Reporting By Mary Wisniewski; Editing by Greg McCune and M.D. Golan)

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