Charlie Baker’s showdown with Democrats over Medicaid, explained

Massachusetts Gov. Charlie Baker (center) and Senate President Stan Rosenberg (left) listen as House Speaker Robert DeLeo (right) speaks during a news conference in February. Keith Bedford / The Boston Globe

BOSTON (AP) — Republican Gov. Charlie Baker has delivered an ultimatum of sorts to Democrats on health care.

He’s asked the Legislature to act within 60 days on a package of changes he’s proposed in the state’s Medicaid program, known as MassHealth.

The stakes are high. Baker and legislative leaders agree on the need to rein in the escalating costs of MassHealth. But the governor’s plan is getting pushback from some Democrats who argue it has not been properly vetted and would hurt tens of thousands of low-income families.

A closer look at the looming Medicaid showdown on Beacon Hill:


The problem

About 1.9 million Massachusetts residents are covered by MassHealth, which consumes 40 percent of the state’s $40 billion budget. It’s rapidly increasing costs have squeezed out other spending priorities, such as education and transportation.


While Medicaid is perceived as a health insurer of last resort for the poor, disabled or unemployed, Baker has pointed to the growing numbers of working, able-bodied residents enrolled in the program. Often they’re in it because their own employers do not provide — or offer inadequate — health insurance benefits.


Baker’s plan

After discarding a proposal for a $2,000-per-worker charge on employers who do not provide health care benefits, Baker last month asked lawmakers to support a reworked employer assessment along with other MassHealth changes, totaling about $350 million in savings or offsets.

About 140,000 non-disabled adults with incomes above 100 percent of the federal poverty level would be shifted from MassHealth to the state’s subsidized ConnectorCare program. Additionally, most people with access to employer-sponsored health plans would be barred from enrolling in MassHealth.


Baker’s package also includes a five-year moratorium on new mandated insurance benefits and allows for the creation of a new class of dental practitioners, called dental therapists, who could perform certain procedures for low-income patients that only dentists can do now.


What critics say

Low-income people forced off MassHealth and into ConnectorCare or other commercial programs would pay more for their coverage while losing benefits such as dental care, opponents contend. Many would have to start paying premiums or see their out-of-pocket costs for co-pays and deductibles go up, the critics argue.

Gus Bickford, the state’s Democratic party chairman, derisively labeled Baker’s plan “CharlieCare,” and said it would kick tens of thousands of working parents off Medicaid.


Democratic gubernatorial candidate Jay Gonzalez, a former state budget official, accused Baker of hypocrisy.

“This is a guy who claims to be against what Republicans in Washington are doing while he is doing the exact same thing here at home,” said Democratic gubernatorial candidate Jay Gonzalez, a reference to Baker’s opposition to Medicaid cuts contained in plans GOP congressional leaders to repeal and replace President Barack Obama’s health care law.

Baker’s response: “The proposal we made was designed to ensure that everyone who has coverage keeps coverage,” he said last week.


What the legislature did

Lawmakers included the employer assessment in the state budget they sent Baker earlier this month, but not the other MassHealth proposals.


Legislative leaders said they got Baker’s just days before a final budget for the July 1 fiscal year was due, leaving insufficient time for a proper review.

Baker, in turn, noted that when legislators had a chance to develop their own proposals earlier in the budget cycle, they deferred to his administration.


Where things stand

Baker declined to approve the employer assessment without the other proposed changes included and demanded that lawmakers return the full Medicaid package — or something comparable — to his desk within 60 days.

With the ball back in their court, Democratic legislative leaders aren’t making any promises.

“It’s something that is very strongly on my radar screen,” said House Speaker Robert DeLeo, adding he was discussing options with health care policy experts.


Senate President Stan Rosenberg pledged to consult “stakeholders,” and suggested the Senate might offer its own set of proposals.

“We can’t dilly dally here; we have to do something,” Rosenberg told Boston Herald Radio. “Otherwise the budget will be out of balance.”


If no agreement

As Rosenberg noted, the state’s current budget assumes the $350 million in revenue and savings associated with the yet-to-be-approved MassHealth changes, so no action would leave a sizable hole.

Should that happen, Baker says “corrections” will be needed in the budget. In other words, spending cuts.