Governor’s Medicaid expansion rejected

LANSING (AP) – Republican-led legislative panels on Thursday rejected expanding Medicaid eligibility to 320,000 Michigan residents next year but left open the possibility of reversing course in coming months if changes can be made to the health insurance program for the needy.

Gov. Rick Snyder wants to expand Medicaid under the federal health care overhaul, saying it makes financial sense and is a chance to improve the health of people without insurance. But so far he has been unable to persuade fellow Republicans who control the Legislature.

The U.S. government would cover the full cost of new Medicaid enrollees for three years, phasing down to 90 percent in 2020 and after. The state would save $200 million a year initially because more people receiving mental health services and medical care with state aid would instead be covered with federal money. Snyder proposes tucking away half of the savings, so Michigan effectively would not owe anything for covering more people until 2035.