Pandemic Derails Promised Medicaid Expansion

The coronavirus pandemic has put a pause on Democratic leaders’ ability to fight for more government funded healthcare coverage, like Medicare and Medicaid

The stalled progress on coverage expansion proposals carry the risk to deprive Democrats of an opportunity to claim momentum on their health agenda amidst the presidential election. The reelection of President Trump would more than likely result in the paused proposals turning into abandoned proposals. If Joe Biden loses the presidential race, it will be a challenge to push through a public option and other health plans that are so fiercely opposed by Republicans.

Defending the priorities of the democratic party, Chris Jennings, Biden’s campaign adviser said, “When your house is on fire, you’re not focused on building another wing.”

Paused promises by state


In California, coronavirus has caused Gov. Gavin Newsom to abandon plans of extending Medicaid coverage of 27,000 undocumented immigrant seniors after the pandemic blew a $54 billion hole in the state budget. Newsom has not commented on whether he might reconsider the proposed expansion. The coverage would have cost the state an estimated $87 million in the first year.


The state of Colorado was prepared for a fierce battle over the public option this year, offering a preview of how a similar national effort would play out. Democratic Gov. Jared Polis, who campaigned on the idea two years ago, had made an all-out push for the legislation, condemning hospitals opposing it as greedy. Hospitals and insurers had fought back hard, attacking the bill months before it was formally introduced.

Next year’s bill prospects will depend on Democrats holding a two-seat majority in the state Senate and if the public sentiment is strongly in hospitals’ favor after the pandemic, or not.

Under the legislation, the state would offer an insurance plan at an estimated seven to 20 percent cheaper than private options by paying doctors and hospitals less. The state projected about 18,000 people newly able to afford coverage would sign up for the plan.

“It will not be hard next session to say we need to strive for improvements in access to health care,” said state Sen. Kerry Donovan, the bill’s sponsor.


In Kansas, the proposed bill to expand Medicaid to about 150,000 poor people has been tabled for this year, as well. Democratic Gov. Laura Kelly earlier this year struck a deal with a leading state Senate Republican to expand Medicaid. However, expansion legislation got bogged down amid a fight over abortion policy before the coronavirus managed to seize most legislative work for the year.

Kansas has so far avoided making emergency budget cuts, and Kelly said she expects Medicaid expansion to pass next year.

“If this pandemic has done nothing else it has shown how critical access to health care is,” she said in an interview.


In Oklahoma, which holds the nation’s second-highest uninsured rate, Republican Gov. Kevin Stitt has called off his plans to expand Medicaid on effective July 1. The change in direction came a week after Stitt vetoed a plan for financing the expansion, noting that Medicaid is facing greater strain than expected since the coronavirus emerged. Still, there’s a chance Oklahoma voters might green-light expansion next month through a ballot referendum, though the coverage likely wouldn’t take effect this year.


Washington state has slowed down the launch of its pioneering public option for this fall, citing the challenge of standing up the program as hospitals and health insurers are consumed by the coronavirus response.

Expectations are high for Governor Jay Inslee’s looming debut of his state’s first-in-the-nation public option. Under the program, approved by the state legislature last year, the state planned to offer cheaper coverage that caps payments to hospitals and doctors below the rates paid by private insurers.

Hospitals in the state, which were never big fans of the idea, are balking at lower rates, citing financial devastation from the pandemic. Inslee recently said the state is launching the public option this fall as planned, but he said it could take years to ramp up the program.

Public option 

Public option critics say the idea will be a tougher sell in statehouses after the pandemic upended hospitals’ finances, with many providers taking huge revenue cuts following the cancellation of elective surgeries during stay-at-home orders.

“Public option ideas are going to face new hurdles,” said James Capretta, a fellow at the American Enterprise Institute. “Legislators are going to feel a lot of political pressure from hospitals that say now is not the time to move more of our patient base into a regulated payment system.”

Democrats continue to fight for Medicaid cuts

The chances that Democrats can revive many of these ambitious coverage plans will depend on the political and economic outlook that emerges if or when the health emergency subsides. The prognosis for a quick economic recovery remains uncertain, as some states are facing massive COVID-19 hits and revenue declines, such as California, New York, and Ohio. Some states have already made or planned Medicaid cuts, as millions of newly jobless Americans are expected to strain the safety net healthcare program for the poor. A lot remains uncertain for the economic security of the United States and Medicaid expansion has seemed to lose its priority amid coronavirus. 

Up Next...

blog image

Medicare World Blog

CA Residents: Privacy Notice for California Residents |