The GAMC fix -- and truce -- isn't holding

Non-emergency health care for the poor is back in jeopardy in Minnesota, just six weeks after the Legislature and Gov. Tim Pawlenty supposedly removed a threat first imposed when the governor cancelled fiscal 2011 funding for the program one year ago. The fix Pawlenty signed into law on March 26 isn't working, and the remedy the Legislature wants sits under a veto threat.

Pawlenty objects to transferring the very low-income, often chronically ill adults in the General Assistance Medical Care (GAMC) program to Medicaid, a program whose costs are split with the federal government. That possibility presented itself when the federal government enacted its health care reform bill. It became known within days of March GAMC fix -- and only a few days before all but one of the 17 hospitals that bill designated to manage non-emergency care for the GAMC population announced that the new program was too poorly funded, and refused to participate.

The Republican governor has offered a number of objections to the Medicaid transfer, and the DFL's leading health policy lawmaker, veteran Sen. Linda Berglin of Minneapolis, says she has crafted a bill that satisfies each one.

Pawlenty said the Medicaid transfer would add to the state's costs in the next three years (after which, under the new law, the federal government will fully cover the health care costs of people making less than $7,800 a year.) Berglin has cut rates paid to providers in other programs to cover those costs, so that her bill's effect on the state budget nearly matches Pawlenty's own proposal. The governor said that the surcharge increases for hospitals, nursing homes and HMOs in Berglin's bill -- $78 million in fiscal 2011 -- are actually tax increases. She disputes that, saying the surcharges are a mechanism for drawing down the maximum amount of available federal matching dollars, and are in most cases returned to the providers that pay them.

She's also able to make a claim for Medicaid that the governor can no longer make for the GAMC program: It adequately serves a truly needy population. It does so in a way that does not put health care providers in jeopardy, as 16 hospitals say the revised GAMC would. In fact, Berglin said, enrolling poor adults in Medicaid would bring $1 billion in additional federal funds into the state, creating more than 20,000 jobs in the next three years.

Pawlenty and Berglin have tangled for eight years, as he has pushed to control health care costs while she has sought to maximize Minnesotans' access to cost-effective health care. On the few occasions when they made common cause, as they did on health care reform in 2008, Minnesotans were the winners. For the sakes of the poorest Minnesotans, these two lawmaking powerhouses need to come together one more time.