The debate over Medicaid expansion in Missouri began in earnest in late 2012.

Hospitals, chambers of commerce and others lined up to urge the General Assembly to accept expansion, while Republican legislators made it clear Missouri would turn the proposal aside. Medicaid expansion became a political football, putting the future health care of nearly 300,000 Missourians who would have qualified for help at risk.

The Affordable Care Act – widely referred to as Obamacare – uses federal tax dollars to fund Medicaid expansion to cover adult Medicaid eligibility to 138 percent of the poverty level. That means that individuals earning up to $15,850 a year and families of four with an annual income of $32,500 would be covered.

Missouri and more than 20 other states have said no to expansion or are considering refusal. The Missouri Hospital Association and local health-care providers said that decision will have a significant impact on hospitals, especially those in rural communities, and will ultimately cost the state much-needed jobs.

Currently, low-income parents with children are eligible for Medicaid. Adults with no children are not eligible unless they are disabled. Expansion would provide health-care coverage to an estimated 280,000 currently uninsured Missourians, including some adults with no children. The office of Gov. Jay Nixon, who began promoting expansion in November 2012, puts the figure at 300,000.

The federal program fully funds the cost of expansion through 2016. States would pick up 5 percent of those costs in 2017 and 10 percent by 2020.

An important part of the funding package includes disproportionate share hospital payments. The DSH payments have long been critical to hospitals, compensating for care provided free to low-income patients who cannot pay and are not covered by insurance or other programs.

When the U.S. Supreme Court upheld the Affordable Care Act in June 2012, it also ruled that states are not required to accept Medicaid expansion, but it made no exception protecting states from new funding mechanisms. Two of those are reduced payments to Medicare in the state and a reduction in DSH payments. Thus hundreds of millions of dollars worth of unpaid care will not be reimbursed to Missouri hospitals, putting them at risk of drowning in red ink. As many states this year balked at expanding Medicaid, the Obama administration late in the spring pushed back the reduction in DSH payments by a year.

Despite the urging of organizations across Missouri and Gov. Jay Nixon to expand Medicaid and keep funding mechanisms in place, the General Assembly did not include expansion in the state budget. Instead, the Senate named a committee and the House named two committees to look into the issue. One of those House committees, the Citizens and Legislators Working Group on Medicaid Eligibility and Reform, was chaired by Rep. Noel Torpey, R-Independence, and held meetings in Independence and five other cities across the state to get citizen comments.

Torpey said it appears that “many if not most Missourians want Medicaid expanded” and said his group would file a report with House Speaker Tim Jones with recommendations on how to handle expansion during the 2014 legislative session.

One member of Torpey’s group was Dr. Bridget McCandless, recently named president and CEO of the Health Care Foundation of Greater Kansas City. She co-founded the Shared Care Free Clinic in Independence in 2001, and she remains, as a volunteer, its medical director. She said those those who spoke to the committee were overwhelmingly in favor of expanding Medicaid.

“I hope that message came through loud and clear to legislators,” she said.

Among the issues that came to light, she said, is the number of people who are poor but healthy – and who want to stay healthy but have limited access to care. In Missouri, adults generally have to be sick to the point of disability to qualify for Medicaid. Advocates of expansion have pointed out that many of those not now covered – in rural, urban and suburban parts of the state – are working two or even three low-paying jobs, none of which offer health coverage.

Expanding Medicaid to the level envisioned under Obamacare would change that drastically.

“What that would mean is that the majority of the people I see would have access to comprehensive coverage,” McCandless said.

Failing to expand Medicaid also creates a needlessly complicated situation, she said. For example, many earn too little to qualify for federal health-insurance subsidies but, in Missouri, too much to qualify for Medicaid. Patients, McCandless said, find that confusing.

“I think it’s also very frustrating for doctors providing care,” she said.

The Missouri General Assembly could consider Medicaid expansion in the 2014 session beging in early January. Federal funding for expanded Medicaid begins Jan. 1, but Missouri has already lost out on that first year of funding.

The Missouri Hospital Association will move quickly in the new year to support legislative acceptance of expansion. An association poll taken last spring indicates 56 percent of Missourians favor expansion.

According to the association, the high rate of the uninsured, and expanded use of hospital services by the uninsured, has led to a significant increase in hospital uncompensated care costs.

In 2011, hospitals provided $1.3 billion in uncompensated care statewide. Without additional coverage, hospital uncompensated care is expected to increase to $3.5 billion annually by the end of the decade, according to the association.

Hospitals receive some funding through Medicaid and Medicare to offset the costs of providing uncompensated care, but much of the remaining cost of caring for the uninsured is shifted to commercial insurance carriers, increasing the cost of premiums paid by employers and/or individuals.

Jeff Fox of The Examiner contributed to this report.