Why would tobacco companies spend more than $9 million
opposing a referendum
in Montana that could extend Medicaid expansion in the state beyond a
scheduled 2019 sunset? The referendum not only asks if voters want to extend
the expansion beyond the sunset, but also asks tobacco users and the tobacco
industry to provide the funding.
When the Affordable Care Act was initially implemented, the
federal government bore 100% of costs associated with initial expansion. The
share of federal funding, however, began to be reduced in 2016 and will
eventually fall to 90% by 2020. As the federal share of funding is gradually
reduced, Montana and other states are seeking creative ways to compensate for
Most expansion states are using general funds to make up the
shortfall, but 13
expansion states are seeking to make up the funding through a variety of
other means, including additional taxes, fees or cuts to Medicaid.