A legislative study committee tasked with examining virtually every aspect of South Carolina’s faltering health care market will not move forward in 2024 after a sweep of Gov. Henry McMaster’s veto pen removed it from the new state budget last week.
McMaster raised two objections: the study’s six-month time frame, which he said was too short, and the inclusion of Medicaid expansion as one of the 30 market reforms to be examined.
“I remain unconvinced that the expansion of Medicaid benefits — which this legislative study committee is tasked with considering — is necessary, nor do I believe it is fiscally responsible,” McMaster said in his veto message.
But supporters of the study say a close look at what’s happening just over the border in North Carolina might ease S.C. leaders’ concerns — an idea N.C. Gov. Roy Cooper seemed to echo in recent comments to Statehouse Report.
Cooper, a moderate second-term Democrat whose state expanded Medicaid last year with supermajority Republican support in the N.C. legislature, says the Tar Heel State’s expansion has been so successful that other states have been reaching out to learn more.
“Already leaders in states that haven’t passed it have requested information and testimony from North Carolina leaders,” Cooper said in a statement, “and we are glad to share all of it with our South Carolina neighbors.”
What expansion would do
Originally offered to states as part of the Affordable Care Act (ACA), or Obamacare as it’s widely known, Medicaid expansion raises the income limit for people who get health care through the program from 67% of the federal poverty level to 138% — about $20,000 a year in today’s dollars. Under ACA rules, the federal government pays 100% of the cost of expansion in the first three years and 90% thereafter.
South Carolina is one of only 10 states that has not opted to expand. If South Carolina were to participate, about 300,000 people living at the low end of South Carolina’s wage spectrum would have a chance to get better health care.
Beaufort Republican Sen. Tom Davis, who sponsored the budget amendment creating the study committee, says he shares the governor’s “concerns and reservations about Medicaid expansion” and respects his decision.
But he also warns that continued inaction in the face of significant problems in the state’s health care market, including high costs for patients, struggling rural hospitals and a growing shortage of doctors and providers, could eventually lead to far more drastic changes.
“(The committee) was an attempt to take a comprehensive look at the supply and demand sides of healthcare markets and how they could be improved,” Davis told Statehouse Report. “Because doing nothing will keep us lurching toward the most unacceptable outcome of all — a single-payer system.”
Moreover, he notes, many states with conservative credentials every bit as strong as South Carolina’s have found ways to benefit from expansion.
“The intent would be to better understand the flexibility waivers that have convinced many conservative states to expand Medicaid,” Davis said. “Arizona, Arkansas, Indiana, Iowa, Montana and Utah have all secured (federal Social Security Act) Section 1115 waivers to operate their Medicaid expansion programs in ways not otherwise allowed under federal law.”
Others with concerns about McMaster’s veto again point to a state closer to home — North Carolina.
“They’ve done an incredible job,” said Sue Berkowitz, policy director at the Appleseed Legal Justice Center and a member of the leadership committee of Cover S.C., which advocates for health care reform in the Palmetto State. “People with concerns should look at the success they’ve had in North Carolina.”
The North Carolina experience
North Carolina’s Medicaid expansion was signed into law in March of last year with strong bipartisan support, winning the votes of more than two-thirds of Republicans in the state legislature.
Since the law went into effect in December, about half a million North Carolinians have signed up for coverage.
N.C. Senate President Pro Tem Phil Berger, long a fierce Republican opponent of Medicaid expansion, explained his change of heart in a 2023 op-ed.
“By expanding Medicaid now — on our own terms — we increase access to health care in a thoughtful, conservative way,” Berger wrote. “We pass a plan that is good for North Carolina, and we take advantage of holding out for the past decade and secure a significant stimulus that avoids the financial hit the state would have taken years ago.”
Cooper told Statehouse Report that his state’s bipartisan legislative supermajority vote reflected the reality on the ground across his state.
“We built a non-traditional coalition of advocates,” Cooper said, “including Republican county commissioners who wanted to keep rural hospitals open, law enforcement leaders who knew their officers and jails were spending too much time with people who needed health care and not handcuffs, business leaders who knew private insurance premiums are lower when medical providers have less indigent care and more.”
And already, he says, the results have been “transformative” for N.C.
“Medicaid expansion is changing lives across North Carolina. Nearly 500,000 people have enrolled in quality, affordable health care in the seven months since Medicaid expansion went live,” Cooper said. “That is transformative for hard-working families, our economy, our rural health care system and the fight against the opioid crisis.”
The coalition for reform in S.C.
Here in South Carolina, advocates are working to create a similarly broad-based coalition for health care reform through Cover S.C., a grassroots network of more than 40 organizations including the Appleseed Center, the S.C. Small Business Chamber of Commerce (SBCC) and AARP South Carolina.
SBCC President Frank Knapp says reform is critical for Palmetto State small businesses, which need healthy workers but often struggle to provide coverage for their employees due to high premium costs.
“We have well over 300,000 South Carolinians caught in the coverage gap where they make too much to qualify for traditional Medicaid but too little to qualify for premium assistance under the ACA,” Knapp said. “It’s unfair to them and it’s unfair to most South Carolinians, who have to pay for the uncompensated care.”
Uncompensated care occurs when people who are unable to pay for medical care receive needed treatments, usually in emergency rooms. Hospitals then pass those costs along to everyone else in the form of inflated prices, which in turn leads to higher insurance premiums.
Charmaine Fuller Cooper, state director of AARP SC, said her organization sees many older South Carolinians who are trapped in the coverage gap Knapp describes, making both too much money and too little.
“People between 50 and 65 are often not working as many hours and don’t have the full-time benefits they would like to have,” she said. “And because of that, they can’t afford the healthcare they need.”
But like other members of Cover S.C. — and like Cooper in N.C. — Fuller Cooper stresses the importance of listening to everyone’s concerns and working together to build the broadest possible coalition for reform.
“We are looking forward to having further conversations with the governor to find out more about what his concerns are and to see if we can address those concerns moving forward,” she said.
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