Health groups propose voter-initiative to hike tobacco taxes, extend Medicaid expansion

Posted at 5:22 PM, Feb 22, 2018
and last updated 2018-02-22 19:22:38-05

Hospitals and other health-related organizations Thursday proposed a voter initiative to extend Montana’s expanded Medicaid program past 2019 and raise cigarette and other tobacco taxes to finance it.

The measure, whose language was filed late Thursday with state officials for review, would raise state taxes on cigarettes by $2 a pack and other tobacco products by 33 percent.

If the initiative qualifies for the November ballot and is approved by voters, money raised by the tax increase would be earmarked to pay the state’s share of Medicaid expansion, which provides mostly free health coverage to 91,000 low-income adults in Montana.

“Increasing the tobacco tax saves both lives and money by preventing kids from smoking, and reducing the toll of cancer and heart disease on our health and our economy,” said Amanda Cahill of the American Heart Association and American Stroke Association. “It also provides needed funds to help our veterans and preserve insurance coverage for hard-working, low-income Montanans who need access to health care.”

Groups working on the proposal include Montana hospitals, health-care professional associations, organized labor, and AARP Montana. However, the groups haven’t formally endorsed the plan.

“Preserving Medicaid will ensure that 91,000 Montanans do not lose their health coverage,” said Dick Brown, head of the Montana Hospital Association. “Coverage ensures a healthy and productive workforce and creates thousands of jobs for nurses and other medical staff.”

Medicaid expansion, a key part of the Affordable Care Act, or “Obamacare,” is set to expire in Montana in June 2019 – unless the Legislature votes to extend it.

Supporters of the program have said privately they’re worried the Republican-controlled Legislature may not vote to extend the program, which is expected to bring $2 billion of federal funds into Montana during its first 40 months.

The state’s approximate 10 percent share of the program is estimated at $150 million and $200 million during the two-year budget period starting July 2019.

Money raised by the proposed initiative would be earmarked to pay not only the state’s share of Medicaid expansion, but also veterans’ programs, such as suicide prevention, anti-smoking efforts, and long-term care services to help the elderly live independently.

Expanded Medicaid offers health coverage to adults aged 19-64 and who earn up to 138 percent of the federal poverty level – about $16,600 a year for a single person.

A public vote in November in favor of the initiative would put the tax increase and Medicaid extension into law, but the 2019 Legislature still would have to authorize state spending on the program. 

Once a legal review of the ballot language is completed by state officials, its supporters must gather enough signatures of registered voters to qualify the measure for the ballot.

They need at least 25,468 signatures statewide and at least five percent of the registered voters in at least 34 state House districts. The signatures must be turned into county election officials by June 22.

A coalition of Democrats and moderate Republicans at the 2015 Legislature approved Medicaid expansion, but supporters of the program have said they’re not sure that same coalition would hold at the 2019 Legislature.

Republicans have a 59-41 majority in the current Montana House and a 32-18 advantage in the Senate. The 2018 election likely will change that makeup, but most observers believe Republicans will still maintain solid majorities.