In it, but not of it. TPM DC

McAuliffe Defies GOP: We're 'Moving Forward' With Obamacare Expansion

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AP Photo / Steve Helber

McAuliffe's unexpected announcement comes after months of drama over Medicaid expansion in Virginia. The state government had been barreling toward a shutdown after the House and Senate couldn't reach an agreement on a budget because of their disagreement on the issue.

Then controversy exploded earlier this month when a Democratic senator resigned -- because, some alleged, he had been promised a seat on the state tobacco commission and a judgeship for his daughter -- giving the GOP control of the Senate. It already controlled the House.

The legislature then passed a budget with the amendment that attempted to restrict McAuliffe's ability to expand Medicaid unilaterally -- which is what he vetoed Friday.

On the legality of his plans -- still not yet clear -- McAuliffe said the state attorney general's office had been consulted on "everything that we have done and everything that I have talked about today."

"Whatever we do will be in full compliance with the attorney general's office," he said. He also indicated that the administration was considering a "private option," which would use Medicaid dollars to purchase private coverage.

As for whether he would wait to act until the legislature reconvenes in 2015, McAuliffe indicated that he would not. He has asked administration officials to prepare a plan by Sept. 1.

"If the General Assembly wants to come onboard at some point, we're happy to do it," he said. "But I have no illusions on the General Assembly. … As it relates to this issue, they have turned their back time and time again."