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Texas’ Perry rejects Medicaid expansion. What now? (+video)

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The provision that Perry wants the state to reject would add to the state’s Medicaid rolls more than 1.5 million poor, childless adults who are currently ineligible, plus as many as 300,000 pregnant women, children and extremely poor parents who already qualify but aren’t enrolled.

The coverage would begin in 2014. In the first five years, the state’s costs for the expansion would be $5.8 billion, and Texas would receive $76.3 billion in federal matching funds. Despite that prospective gain, Perry said it would be unwise to enlarge “a broken system that is already financially unsustainable.”

The Republican governor also told Sebelius he opposes a state health insurance exchange, which he said would open the door to federal control of Texas’ insurance markets. Some other conservatives have argued Texas should take steps to set up the exchange on its own, in case the federal law survives. If it does, the federal government will establish the exchange.

Federal officials declined to respond directly to Perry, saying that under the law, the exchanges and other benefits will help expand coverage and pledging to work with states to provide flexibility.

Perry’s move was the latest political twist after the Supreme Court upheld most of the 2010 health care overhaul. While most of the legal battles have been over the law’s requirement that individuals obtain insurance, the bulk of the expansion of health insurance coverage is designed to happen at the state level, and GOP governors such as Rick Scott of Florida and Nikki Haley of South Carolina have rebelled.

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