In his budget message Tuesday, Gov. Tom Corbett said he rejected the expansion of the Medicaid program under the federal Affordable Care Act.
Detractors criticized the move, saying it denies the state's health care sector needed funds, since it would reject federal funding that would come with the expansion.
Medicaid is the joint federal-state insurance program for the poor. The Medicaid expansion exposed a divide in the health care delivery system: Hospitals and doctors are generally supportive of insuring more people while operators of nursing homes who are under-reimbursed by Medicaid for care they deliver are skeptical of expansion of the program that fails to cover their costs.
Mr. Corbett has held that the state should avoid expanding entitlements unless it can afford them in the future.
Soon after the budget was released, Mr. Corbett sent a letter to Kathleen Sebelius, federal secretary of health and human services, calling for reforms of the program, saying the high cost precludes the state from expanding the program as required unless the state has more flexibility administering the program.
Under the Medicaid expansion, states will receive 100 percent federal funding for the first three years, phasing down to no less than 90 percent federal funding in subsequent years, according to a U.S. Department of Health and Human Services website.
Geisinger Health System spokeswoman Wendy K. Wilson said the hospital system supports expanded coverage and access to health service regardless of ability to pay. The uninsured often put off preventive care, possibly aggravating their condition until it becomes an emergency that is more expensive to treat.
"We already absorb the cost of charity care for patients who don't have public insurance, and the hospital is not reimbursed for that," she said. "Insuring some of those people allows them to take advantage of preventive care."
Michael Kelly of Senior Health Care Solutions, operator of four skilled nursing facilities and seven assisted living centers, said Mr. Corbett is trying to buy time to assess the complete fiscal impact of the Medicaid expansion.
Mr. Kelly said Medicaid reimbursement does not cover the cost of providing the care. Nursing homes would make up the loss by securing cash or private insurance clients. Even Medicare reimbursements have been cut.
Two senators representing Northeast Pennsylvania were sharply critical of the governor's decision.
"It will be damaging to the economy in Northeast Pennsylvania," said Sen. John Yudichak, D-14, Nanticoke. "Hospitals and health care are the largest employers in Pennsylvania."
"It's a failure on the part of the governor," said Sen. John Blake, D-22, Archbald. He said those without health insurance will continue to seek more expensive care in hospital emergency rooms.
Contact the writer: dfalchek@timesshamcork.com