June 30, 2017 Press Releases and Announcements

Former Virginia Trump Campaign Co-Chair: Under Senate Health Bill, Virginia is “Screwed in Perpetuity” for Blocking Medicaid Expansion

by Katie Baker

Now that the U.S. Senate's version of Trumpcare has been released, John Fredericks – Donald Trump's former Virginia campaign co-chair – admitted it was wrong to block Medicaid expansion, as, under the Senate legislation, Virginia would now foot the bill for states that chose to expand the program.

In the House of Delegates, however, Republicans such as John O'Bannon don't have the same ability to recognize the shortsighted mistake. O'Bannon said in April that he was “more convinced now than ever” that he made the right choice to block Medicaid expansion for 400,000 people. Does he believe the same thing, now that Virginia will lose more than $1.4 billion dollars while hundreds of thousands of Virginians remain uninsured?

Fredericks said, “Look, you just got to be honest. People have to be honest about what happened. And you know when the hyperbole is done. We’re getting the shaft on two ends and conservative states like Indiana and Arkansas are getting all the money and we’re not. It just doesn’t make any sense.”

Fredericks made his remarks in an interview with Governor Terry McAuliffe last week. A partial transcript is available below and starts at 8:02:

John Fredericks: The Senate bill yesterday, the draft of it for Trumpcare, if you will. Funding those states that expanded Medicaid, for another I guess, 48 months. But then those that didn’t, like Virginia, you get a smaller block grant. So basically we’re getting screwed twice.

Governor McAuliffe: We’re definitely getting screwed twice, John. We’re totally out of the expansion. So let’s quickly recap where we are and I hate to say I told you so, but I told you.

JF: Well you did. You were right.

GM: If the senate bill passes, hundreds of millions of dollars, I’m going to have to take out of our budget, when I have to draft our budget at the end of this year. If the House bill passed, the same thing. If they do nothing John, we are still losing $2.4 billion a year on expansion. We’ve already lost $10 ½ billion. Even today if you read the Richmond Times-Dispatch, Republican members have now realized that they probably really goofed up and that this money is going to be gone forever and the impacts to the Virginia budget are going to be devastating. Exactly what I have been saying for 3 ½ years. They could have drafted a bill, sent it to me and said no state dollars could be used, only federal dollars. I could have gotten this done with no exposure to the state and brought billions of dollars back to help 400,000 Virginians. Now we are going to pay the price. So the Senate and House bill, even if they pass that, we are really in trouble and if nothing happens we are continuing to forfeit all of this money.

JF: So if this is going to pass, I think in the Senate. They’re going to renegotiate it obviously now. Then it goes into reconciliation, but as it is now, the way you see it. How will that affect Virginia because we’re going to go to a block-grant system, which is not going to equal…

GM: We’re going to go to a per-cap number, so you’re going to get a set number John. We’re like 50th out of 50th on our benefits. I mean, if you’re a single women with two children, you have to make less than $6200 a year. I mean there is no room for Virginia to cut. If the economy goes down and or the stock market goes down, we the state are now going to have to pick up 100% of that cost. This is going to be crippling and the existing dollars we’re going to lose to the Virginia health care system. You know, I’ve got a report letter sent to me yesterday that says we lose probably up to $1.2 billion. This is real money, John.

JF: That’s money we’re getting now?

GM: Yes, right. That we’re going to lose.

JF: We’re going to lose. So you’ve got two sides. You got the money we gave up which is about now $12 billion dollars.

GM: It’s $2.4 billion a year. $6.6 million a day. That’s gone.

JF: So it’s about $10 billion, right? The deficit didn’t go down. The deficit keeps going up. So that money just went to other states. So it’s not like we participated in this champion federal deficit reduction. The deficit has gone up. Money went to other states. So we didn’t get it there. Plus, working class people that don’t make a lot of money, they’re not covered.

GM: Remember John, for the next three to four years, they’re going to continue to get this (expansion states will receive funding). We’re not going to get it. For the next three to four years other states will get it and we’re going to lose $2.4 billion a year going forward. Because the effective date was March 1, we can’t get it now.

JF: Right, it’s states led by Republican governors and that have Republican senators in them that passed Medicaid expansion. They’re going to continue to get the funding and then they’re going to get a bigger block-grant.

GM: That’s right. That’s right.

JF: So my point is this, and look I fought you on Medicaid expansion for 36 months, I can man up and say I was wrong. Other people should also because we’re losing $1.2 billion in real money that we’re getting now. We’ve already forgone the $10 billion dollars that we could have had that went to other states. Federal deficit went up. Number three, we’ve got 400,000 working class people that don’t make a lot of money that could have had coverage that do not. Number four is, the states that went with it and got the money, they get a bigger block grant going forward than we do. That’s after it expires, which is probably in about 50 months. How does that make any sense?

GM: For the next four years, we would have gotten $2.4 billion a year like the other expansion states and that $2.4 billion is gone.

JF: Crazy.

GM: Forget about everything else. That much money running through your economy is good for the overall economy of our state. It's hospitals, health care providers, opiate addiction, mental health. John, it’s sprawling, what it would do economically to the Commonwealth of Virginia.

JF: Governor, when the hyperbole and the ideology and the whole thing. When you just boil it down and you look at a spreadsheet. This decision that we made that I fought you on, in the media for 36 months was absolutely the wrong thing to do. We got no benefit out of it and now we’re getting screwed in perpetuity. What the Senate bill ought to say is Virginia, you guys did the right thing. So we’re going to give you the biggest block grant. Instead they are doing the opposite. And the politics of it is…

GM: John Kasich from Ohio, Mike Pence from Indiana and Vice President of the United States.

JF: Yeah, they get the money.

GM: They’re all getting it and we’re not. The most conservative governors in America did this. The one point I want to remind everybody, the argument always was, it will bankrupt the state. I always said write me a bill that says I can bring the money back, but that it will never touch the state money. I went and got a waiver from Washington to run it outside independently, so free money never would have touched the state.

There is no argument from the Republicans. If they sent me a bill and said under no circumstances can we do this program if it ever financially touches the state, and they never sent me that bill, John. Because they were scared of the Tea Party taking them out in a primary. You know why.

JF: Look that may have been it, but the VHHA, the Virginia Hospital Association and their members said they would pony up and pay the 10%. So there was no risk to the Virginia treasury. Look you just got to be honest. People have to be honest about what happened. And you know when the hyperbole is done. We’re getting the shaft on two ends and conservative states like Indiana and Arkansas are getting all the money and we’re not. It just doesn’t make any sense.

GM: Arkansas , Kentucky, are you kidding me?

JF: Kentucky, same thing. Makes no sense. Look I was wrong, you were right.

GM: At the end of the day John, you just hate it, being right or wrong because I got to look people in the eye who grab my arm and say “Governor, I’m going to be dead in a year if you don’t do this.” This is not hyperbole. People lost their lives because they didn’t get the cancer screening that we paid for them to get. This is as serious an issue, as you can get and unfortunately, it became political and shouldn’t have been political. Our neighboring states of West Virginia and Kentucky and Maryland, they’re going to have a healthier workforce because they got people treatment. I saw one Republican say “I’m glad we didn’t take it because they’re going to end it.” Well let me tell you something, John, I would have loved to have the $10 ½ billion and probably the extra eight billion over the next four years. I would have rather have had that $18 billion running through my economy. Get people healthier and then end the program, than not have taken it at all. That is one of the dumbest arguments I have ever heard.