Idaho Gov. Butch Otter Signs Executive Order That Will End Medicaid In His State

Idaho Gov. Butch Otter (R)

Earlier this year, when the Idaho state legislature was considering an unconstitutional bill to nullify the Affordable Care Act, the state’s attorney general issued a stark warning against turning that bill into law. If Idaho passed a law refusing to comply with the Medicaid provisions of the ACA, it could opt itself out of Medicaid:

An additional legal ramification that must be considered as RS 20315 is contemplated is its effect on existing and future Idaho participation in the Medicaid Program. As a purely voluntary program, Idaho’s refusal to comply with the expanded provisions within the PPACA could potentially result in Idaho exiting the program and losing the existent federal matching funds. This could create a situation where individuals presently covered would no longer be covered, yet still require medical treatment, which likely would be required to be provided for and paid for through some non-federal means. This situation, in turn, could create an intense burden on the State’s budget.

Sadly, Idaho Gov. Butch Otter (R) did not heed the attorney general’s warning. Although Otter vetoed a nullification bill attacking the ACA yesterday, he also issued an executive order which effectively forbids his state from participating in Medicaid as soon as the ACA goes into full effect.

Medicaid is an entirely voluntary program in which the federal government provides generous grants to the states to administer a health program for their low-income residents. Yet Otter’s executive order forbids state agencies from implementing “any provisions” of the ACA, and it provides that “[n]o executive branch department, agency, institution or employee of the State shall accept or expend federal funds to implement the provisions of the []ACA.”

The reason why this is problematic is because, starting in 2014, the ACA requires states participating in the Medicaid program to offer health coverage to all persons under the age of 65 who earn up to 133 percent of the poverty rate. In return for expanding Medicaid, the federal government will provide each state with the lion’s share of the funds required to do so.

Otter’s order forbids his state from complying with these new requirements to remain in the Medicaid program, and it also forbids Idaho from taking the federal funds that will allow it to pay for expanding Medicaid.

To be fair, Otter’s order also provides an onerous process allowing Idaho’s Medicaid program to seek a waiver from the prohibition on implementing the ACA. If such a waiver is not granted, it will completely blow up Idaho’s state budget. Presently, Idaho receives over $1 billion in federal grants to administer its Medicaid program — an amount that equals approximately two-fifths of the state’s overall budget. If the state gave up this money, it would have to chose between eliminating health coverage for the 223,198 Idahoans who currently depend on Medicaid or implementing similarly draconian cuts such as slashing its public schools budget by 85 percent.

In other words, in his zeal to strike a political blow again President Obama’s most important accomplishment, Otter has endangered the health of over more than 200,000 Idahoans and forced financial ruin upon his state.