AUGUSTA, Maine (NEWS CENTER) -- The LePage administration is giving the federal government an ultimatum: Accept the Medicaid cuts approved by the Legislature this spring, or Maine will sue.
The state formally filed its Medicaid State Plan Amendment today. According to Maine's Department of Health and Human Services the cuts, which would start October 1, will save nearly $20 million. Under the state's plan:
-- 19 and 20 year olds will lose Medicaid coverage. DHHS says that will save about $4 million and affect 6,848 Mainers.
-- Eligibility requirements in the Medicare Savings program will be reduced. DHHS says that saves more than $2.9 million and affects 1,825 people.
-- And coverage for parents will be reduced from 200 percent of the Federal Poverty Level to 100 percent of the Federal Poverty Level. DHHS says this saves more than $12.7 million and impacts 27,135 people.
Attorney General Bill Schneider and DHHS Commissioner Mary Mayhew say there is no reason the federal government cannot accept these cuts quickly, since they affect parts of the state's Medicaid eligibility that are above federal mandated standards. A letter from the Governor gives the federal government 30 days to accept the cuts or face a lawsuit. "We fundamentally believe that this is a very straightforward request that is absolutely within the state of Maine's prerogative to make based upon the structure of this federal state partnership," Mayhew said.
But that idea is up for debate. Under the Affordable Care Act, states must get a special federal waiver to reduce Medicaid eligibility. Schneider argues that part of the law was thrown out when the Supreme Court ruled that the federal government couldn't make funding dependant on state's willingness to expand Medicaid in the future.
Meanwhile, DHHS Secretary Kathleen Sebelius sent a letter to states a few weeks ago saying that she does not feel the Court's ruling affected that so-called "maintenance of effort" provision of the law.
Schneider says that letter did not address Maine's specific situation. Even if these cuts are made, the state still exceeds federal eligibility requirements. He also argues Maine was forced into an impossible situation. The state accepted extra federal money under a voluntary program for states that maintained Medicaid eligibility standards above federal minimums through June 30th of 2011. Then, the federal government passed the Affordable Care Act, that requires states to maintain their current eligibility levels. While the extra money for states with higher standards expired, the states were still required to keep those higher standards in place. Schneider says the federal government has no right to do that.
The federal government has 90 days to respond to one of these state plan amendments, 60 days past Maine's deadline. The state argues that it was forced to wait for the Supreme Court's ruling on the Affordable Care Act before it could file its state plan amendment, and the state's budget depends on the cuts going through October 1. Schneider says he won't file suit right away if the federal government agrees to fund Maine's portion of Medicaid for the people the state wants to cut until a final decision is made. If the state is not allowed to make the cuts, Maine would pay that money back.
We placed a call to the federal Department of Health and Human Services and have not received a reply.
Democratic 1st District Congresswoman Chellie Pingree and Governor LePage got into a dustup about this issue last month, when she asked Sebelius to tell the governor these cuts were not allowed. She issued this statement today after hearing of the state's decision:
"I continue to believe that taking away health care from seniors and low-income families is not only bad policy, but it violates the law. I'm hoping the US Department of Health and Human Services responds to the state's request quickly with their opinion so any confusion about what the law requires can be cleared up."
Late Wednesday afternoon, Governor LePage sent a statement reaffirming his position on the issue.
In the written release, he says his administration is committed to helping the most vulnerable Mainers, but that the federal mandates are unaffordable.
LePage says "Maine's welfare costs are much higher than the national average and these changes will allow Maine to be more comparable with other states. Maine extended these welfare benefits for as long as we could, however, money has dried up from Washington. In order to save our safety net and sustain it for the long-term, we must make changes."