Dayton signs Medicaid expansion bill

Minnesota is expanding health care coverage to thousands of people living near poverty.

Legislation signed by Gov. Mark Dayton Wednesday will expand federal health care coverage to 35,000 low-income childless adults. The legislation, which passed the State Legislature last week, is expected to save the state millions of dollars as the federal government picks up most of the tab for the expansion.

"Minnesotans who will be covered by this legislation desperately need better quality health care," Dayton said in a statement. "Instead of taking their health crises to emergency rooms, thousands of low-income children, families, and individuals will be able to see doctors sooner and live healthier lives."

The Obama Administration's health care reforms give states the option of expanding Medicaid to coverage childless adults living just above the old cutoff limits for aid. The government will cover 100 percent of the initial cost of the expansion and 90 percent in the future.

While more than 20 states have taken the federal government up on offer, critics – including many Republicans in the Minnesota House and Senate – worried that the state will be left with an expensive bill if the feds don't keep their promise to keep paying the bill.

"This bill is another example of Gov. Dayton's reckless government spending and is a gimmick," Senate Minority Leader David Hann, R-Eden Prairie, said in a statement. "It just doesn't make sense for the governor and the current state legislature to say we should burden future Minnesota state budgets."

The expansion will allow adults who earn just over $15,000 a year to qualify for Medicaid coverage. The state also plans to move thousands of other low-income families out of the state-based MinnesotaCare health program and into Medicaid, which has more generous benefits.

The expansion goes into effect in 2014 and is expected to save the state $129 million in its the first two years. The savings will offset the cost of shifting some 145,000 more Minnesotans out of MinnesotaCare and into Medicaid.

"Our goal is to offer access to quality healthcare to everyone in Minnesota," Sen. Kathy Sheran , DFL – Mankato, author of the state Senate's Medicaid expansion bill, said in a statement. "This legislation gets us one step closer to that goal by covering healthcare for persons earning less than $15,000 a year and will mean a cost savings of $1 billion to the state over the next couple of years. Saving those dollars will help us expand access to care for even more Minnesotans."