Medicaid expansion is a bad deal for Georgians
Amid the confusion about who won what in the Supreme Court’s Obamacare ruling last month, there was one clear winner: the states.
When Georgia and a couple of dozen other states joined Florida’s lawsuit to overturn the 2010 health-care reform, they were contesting the part of the law that affected their governments: the Medicaid provisions. Obamacare called for expanding Medicaid to cover anyone earning up to 138 percent of the federal poverty level; it aimed to force states to go along with this plan by threatening to withhold current Medicaid funding if they didn’t acquiesce.
The states argued this coercion was unconstitutional, and seven of nine Supreme Court justices agreed with them. Instead of striking down the provision altogether, however, the court offered a remedy: Washington couldn’t take away what it’s now giving states for Medicaid, but states could choose whether to participate in the expansion.
That’s left some governors — including our own Nathan Deal — wondering if they should stay out of the program, or join it to catch the billions of federal dollars that would flow to them. It really isn’t that tough a question. Deal should tell the feds thanks, but no thanks.
First and foremost, Medicaid is already a program of limited effectiveness. Its promise of health care for the poor is somewhat theoretical: In a national survey conducted before the court’s ruling for Alpharetta-based Jackson Healthcare, one in four doctors said they won’t see Medicaid patients, and one in three said they won’t accept new Medicaid patients. In Georgia, 42 percent said they refuse new Medicaid patients.
The reason some Medicaid patients have trouble finding a doctor is the program’s low reimbursement rates, which in some cases are below the cost of providing the care. The expansion to 138 percent of the federal poverty level — from the current 42 percent, or less, for most adults in Georgia — is essentially a gamble that doctors can be duped into thinking they might lose money on each Medicaid patient, but they can make it up in volume.
In the first year, according to state estimates, we would add more than 500,000 people to the 1.8 million Georgians already covered by Medicaid (putting one in four Georgians on Medicaid — and stretching the definition of “safety net”). A likely result is even fewer doctors will accept Medicaid patients, making matters worse for Georgians already in the program.
In what sense is that the “fair” thing to do?
What’s more, the expansion is also a bad gamble for taxpayers.
The salient number here is not $35 billion, which is the estimated amount Washington would chip in toward Georgia’s Medicaid expansion between 2014 and 2023. It’s $4.5 billion, the minimum amount this move would cost Georgia taxpayers in those years.
I say “minimum” because that’s the best-case scenario: It assumes the feds keep their word and fund the expansion fully in the first years, declining to 90 percent of the cost by 2020. Washington already borrows more than a trillion dollars a year, with both Social Security and Medicare due to push Uncle Sam even further in debt, so it’s very possible the federal match will decline further.
If it hits 80 percent, that’s more than $1 billion a year by 2020. If it hits 60 percent, which is the current level, that’s more than $2 billion a year from state coffers. That’s money that can’t go to roads, schools or — pass the smelling salts — taxpayers.
By comparison, Georgia just started a 2013 budget year in which it will spend $19.3 billion in state funds.
Even if state lawmakers were inclined to spend an extra billion or two on health care, they’d be wise to avoid the golden handcuffs of a Medicaid expansion. Take the feds’ money and you have to follow the feds’ rules, forever and ever, amen. Turn it down, and that money could go toward lower-cost catastrophic coverage for the same uninsured, mostly young, adults.
Finally, if Georgia and enough other states turn down the Medicaid expansion, it just might force Congress to make more rational, effective arrangements for the program. Block-granting Medicaid funds to states is one possibility. Another is the grand swap proposed by Sen. Lamar Alexander: Washington takes over Medicaid completely and passes k-12 education totally to the states.
Any way you slice it, the Medicaid expansion was a bad enough deal to push Georgia to fight it in court. Now that we’ve won, let’s accept the victory and move on.
– By Kyle Wingfield
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447 comments Add your comment
Kyle Wingfield
July 12th, 2012
10:45 am
JDW @ 10:10, proving once again to be the king of counterfactuals.
Southrrn white boy
July 12th, 2012
10:45 am
There is no commercial health insurance policy anywhere in America that could be purchased with a voucher that would come close to providing the health coverage that Medicaid does for anywhere near the per person cost of the Medicaid program. As to block grants, check out their history. The funding is cut year after year and the states that suffer the most are fast growing states like GA. They are not an answer. They will lead to more uninsurance and more cost shifting to those of us in employer sponsored plans.
Kyle Wingfield
July 12th, 2012
10:47 am
Dirty Dawg @ 10:24: I spent the first part of the column explaining the non-economic reasons it’s a bad deal, for the people who are or would be enrolled in the program.
More and more, we are telling these people, “Here’s some health insurance! Now good luck finding a doctor who will accept it.”
td
July 12th, 2012
10:48 am
Dirty Dawg
July 12th, 2012
10:24 am
” it’s estimated that some 40,000 people die annually because they don’t have access to adequate, and somewhat affordable, healthcare.”
Where is these stats coming from?
Don't Tread
July 12th, 2012
10:48 am
“Medicaid is not a flawed or bad program.”
…Seriously? I suppose you’ve not seen the news stories of people being prosecuted for Medicaid fraud after bilking the system for thousands (tens, hundreds of thousands) of dollars?
There’s plenty of fraud and abuse of Medicaid, which constitutes “flaws” in my book.
iggy
July 12th, 2012
10:48 am
Providing “free or basic” healthcare via the expense of the economy and well being of individuals who contribute something to society, is the absolute wrong thing to do.
Too many scofflaws, bums, excuse makers out there. Let them eat cake.
They BOT suck
July 12th, 2012
10:49 am
Hahahha
All that bloviating for nothing.
Jackson Healthcare can not be considered anything less than a biased source and advocate in every sense of the word.
Next you will be telling me that Maddow and Hannity provide unbiased information.
Keep trying. Information from an org not considered and advocacy group on either side.
Take care
Auntie Christ
July 12th, 2012
10:49 am
In 2011, 20 percent of the budget, or $718 billion, paid for defense and security-related international activities. Adding in NASA, FBI/Homeland Security Anti-Terrorism Programs, Covert Ops, et al raises this to over a trillion $ annually.
For 2011, three health insurance programs – Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP) – together accounted for 21 percent of the budget in 2011, or $769 billion. Nearly two-thirds of this amount, or $486 billion, went to Medicare,
The law of the land states that two of the primary objectives of our government are to “provide for the common defense,” and to “promote the general welfare.” It does not prioritize one over the other,but I cannot believe that the signers of that document would approve of a massive US military presence in Europe, Asia, and of all places Guantanimo Bay Cuba, but denies basic “general welfare” to the citizenry in the form of healing when that citizen is ill.
There is something wrong with a country and citizenry that will spend Billions on weapons and a military presence 1000’s of miles from it’s shores, yet decries a single $ being spent on an indigent who can’t pay for or it or can’t obtain health care because of congenital conditions.
I am a veteran and I understand the need for a standing army, however I will look sceptically at anyone who tells me that bearing the cost of personnel, housing, and other support for a huge army in Europe or Asia is vital to my well being. Not in this age of rapid deployment. If the Germans or Japanese feel thay need protection, let them bear the cost, while we use the money to save lives at home.
md
July 12th, 2012
10:50 am
“Kyle supports a man who has no problem with sticking a state-sponsored gun to the head of a citizen and FORCING compliance.”
Actually, the good folks of MA wanted that system and voted accordingly………which is how it should be….State by State. that way, the option to move if one is extremely dissatisfied still exists……
Instead, we are currently stuck with one parties vision of hc utopia………..
Kyle Wingfield
July 12th, 2012
10:50 am
Southern white boy @ 10:29: I didn’t say they would do that. I wrote, “Even if state lawmakers were inclined to spend an extra billion or two on health care” they would be wiser to spend it that way.
Tiberius - pulling the tail of the left AND right when needed
July 12th, 2012
10:52 am
“” it’s estimated that some 40,000 people die annually because they don’t have access to adequate, and somewhat affordable, healthcare.”
Where is these stats coming from?”
From that nut-job and former Congressman, Alan Grayson of Florida. Took an old Harvard study (I believe) and inflated the numbers already artificially inflated due to flawed analysis.
Kyle Wingfield
July 12th, 2012
10:53 am
Thomas @ 10:37: Actually, what I support on this issue is the exact proposal you mentioned.
iggy
July 12th, 2012
10:53 am
Seems many would rather pay for the latest cell phone gadget, cable television, flat screen tv, HDTV, lease autos they cant afford, go on cruises than pay for their childrens healthcare.
If the State is responsible for feeding, clothing, etc, these kids then these same kids should be made wards of the State and the parents sent to prison for negligence.
md
July 12th, 2012
10:54 am
“There is no commercial health insurance policy anywhere in America that could be purchased with a voucher that would come close to providing the health coverage that Medicaid does for anywhere near the per person cost of the Medicaid program.”
And neither can medicaid…….it’s artificial costs are merely transferred to everybody else through higher doctor/medical fees………..
Kyle Wingfield
July 12th, 2012
10:54 am
Some people @ 10:38: And I wrote as much last year.
Some people are stupid
July 12th, 2012
10:54 am
The real problem is that health care costs are too high, and neither this nor the other parts of Obamacare really get at that from the supply side, which is where much of the problem lies. And it doesn’t address the real problem on the demand side, which is that third-party payer has insulated so many people from the costs of their health care that prices have become immaterial. No market works without the price signal.
You tend to not understand that healthcare is a unique market though. Preventive care is the cheapest but if you don’t have insurance, it’s hard to access would you agree.
As far as the cost of actual healthcare, the macro laws of supply and demand don’t really work. If your daughter had a life threatening disease, and Doctor A, could treat it for 10000 and she has a 50 % chance to live and Doctor B can treat it at 100k, but she has a 99.9% chance to live, most people would find some way to do Doctor B. Each “cost” in healthcare is completely independent of supply. There are 20,000 Cat scan machines in Atlanta, but each one charges a different price based off the skills and talents and the prospective dagnosis and treatment of the physician, not by competition.
Southrrn white boy
July 12th, 2012
10:55 am
Dont tread: yes, seen the reports and read the studies that say that the fraud and abuse in Medicaid is a very small percent of total expenditures. And medicaid spends millions preventing and rooting out fraud.
Do you think the private health insurance world is fraud and abuse free? If so, i have some land to sell you.
Kyle Wingfield
July 12th, 2012
10:55 am
Tiberius @ 10:42: I disagree. Torts are a state matter, and there’s no reason states can’t handle this issue on their own.
ElephantWhip
July 12th, 2012
10:56 am
Just a thought:
This might become moot as soon as the law takes effect. Someone will find the plaintiff that has moved from one state where s/he was covered by the medicare to a state that does not cover her/him. S/he will then file a lawsuit demanding the same coverage s/he was receiving in the prior state under the “Privileges and Immunities” clause of the US constitution (federal law requires that they be insured; they were insured in the previous state; they must be able to receive this privilege in the new state). Then a class will develop. When the class wins, the new state will be required to fund insurance for anyone in this class of people.
Or they could go ahead and take federal funds now under Medicare expansion to help them cover these people.
md
July 12th, 2012
10:56 am
“The law of the land states that two of the primary objectives of our government are to “provide for the common defense,” and to “promote the general welfare.””
Considering the fact that words actually do have meaning, one should notice the the first objective clearly states to “provide”, while the second objective clearly states to “promote”…..there is a difference and it was put there for a reason………..
iggy
July 12th, 2012
10:56 am
Perhaps with the onslaught of Global Warming the populace will be culled via natural selection.
Tiberius - pulling the tail of the left AND right when needed
July 12th, 2012
10:57 am
“All that bloviating for nothing.
Jackson Healthcare can not be considered anything less than a biased source and advocate in every sense of the word.”
I will remind you to look at Page 4 again, They BOTH suck, which references GALLUP polling as well. Admittedly, not to the same numbers (over 70% to Jackson’s 90+% but still significant) but are you now dissing Gallup as well?
Or is it just that you’ve been caught not knowing what the heck you’re talking about – again – and simply need the “biased source” argument to fall back on?
They BOTH suck
July 12th, 2012
10:57 am
We know the numbers are not coming from Jackson Healthcare
Hahahahaha
Thomas Heyward Jr.
July 12th, 2012
10:58 am
md
July 12th, 2012
10:50 am
“Kyle supports a man who has no problem with sticking a state-sponsored gun to the head of a citizen and FORCING compliance.”
Actually, the good folks of MA wanted that system and voted accordingly………which is how it should be….State by State. that way, the option to move if one is extremely dissatisfied still exists……
——————————————————————————————–
.
You couldn’t be more wrong MD.
.
Something about the tyranny of the majority versus natural law.
td
July 12th, 2012
10:59 am
Southrrn white boy
July 12th, 2012
10:45 am
I was in my Dr’s office on Tuesday and we got into a discussion about Obamacare. He told me he has cash patients and charges them $70 per visit for wellness checks and then he can get them a discount for lab work if they want to pay cash.
SBinF
July 12th, 2012
11:03 am
“No one’s made that argument, unless you count the liberals caricaturing what I’ve said, but don’t let that stop you.”
Right. You say don’t allow the Medicaid expansion, yet provide no insight as to how the uninsured folks should access medical care. I think my original post sums it up rather well.
Kyle Wingfield
July 12th, 2012
11:03 am
Some people @ 10:54: You write about these dire circumstances as if they happen to most people on a regular basis. Should we expect people to compare prices on surgeons when they’ve just been in a car wreck? Of course not! That’s what insurance is for. But checkups, immunizations, screenings, and the routine stuff that represents the majority of health care for the majority of people can easily be shopped around (if prices are more transparent, which is a real problem) and are not the kind of thing that insurance is well-suited to cover anyway.
Btw, on your point about CAT scan machines: Read this column, especially the 14th paragraph. Which reminds me, I’ve been meaning to follow up on GHLC…
md
July 12th, 2012
11:04 am
“Or they could go ahead and take federal funds now under Medicare expansion to help them cover these people.”
And cut what??
Tiberius - pulling the tail of the left AND right when needed
July 12th, 2012
11:04 am
“We know the numbers are not coming from Jackson Healthcare”
Oh, you “know”, They BOTH suck?
Please provide your proof that their survey is flawed.
I won’t hold my breath waiting.
Kyle Wingfield
July 12th, 2012
11:04 am
ElephantWhip @ 10:56: I highly doubt SCOTUS would overrule itself on this issue.
@@
July 12th, 2012
11:06 am
I’m always amused by the refusal to acknowledge the benefits of tort reform. HECK! No sooner does the FDA approve a drug are the lawyers all over it. “If you or one of your loved ones has suffered injury or loss of life due to (insert drug/device here)…you may be entitled…blah blah blah”.
md
July 12th, 2012
11:06 am
“You couldn’t be more wrong MD.”
Ok, lets assume I’m wrong…..now explain why……….
Some people are stupid
July 12th, 2012
11:09 am
Kyle-
I can agree with you to some degree on routine processes being shopped around. My only caveat is once again, you get what you pay for. When I get a checkup, I’m paying for the doctor’s experience, I have a lot of friends who are doctors who in your scenario may be cheaped, but could miss signs of things that may effect me long term due to lack of experience. Immunizations and such though, I am in complete agreement.
jose
July 12th, 2012
11:11 am
One of the biggest but untalked about issues in Georgia’s Medicaid program, current or expanded, is the cost to Georgia taxpayers of treating smoking related lllness. Several years ago it was projected that smoking cost to GA Medicaid upwards of more than $100 million. That has no doubt grown and would get exponentially bigger if the state/feds expand Medicaid.
Tiberius - pulling the tail of the left AND right when needed
July 12th, 2012
11:13 am
md, I’ve been trying to get your 10:56 point about “provide and promote” across to these people for years.
But they
just
don’t
get
it.
ElephantWhip
July 12th, 2012
11:13 am
Kyle:
It would not be overruling itself concerning whether the feds can withhold funding which states previously received. It told the feds that they can only withhold funds that would be used to expand Medicare if the states did not expand it, not funds the states already received.
No one raised the issue concerning what a citizen could do in light of this ruling concerning his now-constitutional right to healthcare coverage and a state’s refusal to pay for it even though he had recieved it as a privilege to living in a prior state. (That would have been impossible to raise because no one could forsee which way the court would rule on the Medicaid issue). A plaintiff could not exist to raise the complaint until the plaintiff receives the benefit in one state and is denied the same benefit in another.
I bet the states refusing to get the new Medicaid will be required to pay for coverage of those people out of their own pockets.
Some people are stupid
July 12th, 2012
11:14 am
Here is my issue with those who champion tort reform as some magic bulltet. It someone has suffered some harm due to negligence, how can you put a limit on how much they should get. You can’t predict the future and what this person would have done if said event had not happened. I’m sure if somethign happened to you or your love ones that was a result of malpractice or negligence, you wouldn’t be sitting there saying, just give me up to 100k and thats all.
md
July 12th, 2012
11:15 am
“Several years ago it was projected that smoking cost to GA Medicaid upwards of more than $100 million.”
Don’t worry…..now that the feds have appointed themselves the keeper of all thinks medical, one can count on all the bad things we do getting taxed to the max…….
Cigarettes and tanning beds are just the opening salvo, as they are arbitrary bad choices…..2 out of many, many, many………one is fooling themselves if one believes the feds will stop at 2…….
iggy
July 12th, 2012
11:16 am
“Georgia taxpayers of treating smoking related lllness.”
I wonder what the cost is of treating obesity related illness?
Kyle Wingfield
July 12th, 2012
11:16 am
Some people: Click the link on my 11:03.
jose
July 12th, 2012
11:17 am
One thing that AMAZES me about this whole Obamacare thing….there is no way it can work. Even if it somehow provides insurance for 30 million people llke Obama and Pelosi say it will, mere coverage does not mean access to health care. Georgia, like most states, is severely short on doctors, nurses, and other health care provessionals. That shortage only gets worse…I think the average age of nurses is something like 48 years old…as the years pass. Who exactly is going to provide care for these newly insured. What will happen if the law plays out like Obama says it will, is that a lot of people may have an insurance or medicaid card and no where to go. How exactly is that health care reform?
md
July 12th, 2012
11:18 am
“md, I’ve been trying to get your 10:56 point about “provide and promote” across to these people for years.”
Oh they understand it…..they just don’t want to hear it……..
md
July 12th, 2012
11:19 am
“I wonder what the cost is of treating obesity related illness?”
Can one say “ban the BIG Gulp”……mark my words…..it’s coming…….
td
July 12th, 2012
11:20 am
ElephantWhip
July 12th, 2012
11:13 am
Argument will not work. State already have the flexibility to modify the rules of eligibility for all welfare programs. Example: SCHIP allows the states to provide Medicaid at different income levels. You caould receive Peachcare for your children making $23,000 per year in Georgia but the go to Alabama and take a job for $18,000 and be over the income limit.
Kyle Wingfield
July 12th, 2012
11:20 am
ElephantWhip @ 11:13:
1. The SCOTUS ruling did not find a “constitutional right to healthcare coverage.” It said the federal government has the constitutional power to tax people who don’t buy health insurance. Big, big, big difference.
2. The very policy we are talking about — letting states choose whether to participate in the expansion — was a remedy for the unconstitutional coercion that the justices themselves created. I have full confidence they would not turn around and declare that they’d blown a constitutional issue in creating their remedy.
3. It’s a moot point, because states already provide Medicaid at differing levels of income. If you live in California, you can get on Medicaid at a higher income level than in Georgia; if you move here, you will lose it. If there’s a class-action lawsuit just waiting to happen on this basis, it’s been waiting an awful long time.
Doug B
July 12th, 2012
11:22 am
You left one thing out of your calculations, Kyle: the good done for those people that get healthcare that wouldn’t already have it. Think of the human pain and suffering alleviated. Pretend it’s your mother getting that healthcare and then put a price tag on it.
td
July 12th, 2012
11:22 am
iggy
July 12th, 2012
11:16 am
“Georgia taxpayers of treating smoking related lllness.”
I wonder what the cost is of treating obesity related illness?
Yes let us expand it to any lifestyle choice that could effect your health. Drinking? Risky sexual behavior?
Some people are stupid
July 12th, 2012
11:23 am
Kyle-
Interesting read. I would leave to see all the information when it becomes available. I agree that knowing how much each thing cost is good informatino to have. I am a little worried about the market average suggestion though. If I feel as if I have a good doctor and he charges way more than the market average, I feel like those with not a lot of disposable income will be forced to change to another doctor jsut so they are covered.
AmVet
July 12th, 2012
11:24 am
Speaking of smoking related illness, remember when the tobacco industry used to be the darling of the anti-science conservatives?
Back then the deniers were into “Cigarettes don’t kill people!”
Now they actually posit that man’s role in climate change is a non-factor.
Some things never really change…
jose
July 12th, 2012
11:25 am
My point in posting about smoking related illness is that we are ALREADY paying a tax on smoking (and obesity) in that $100 plus million a year of our tax dollars that could be spent elsewhere are instead treating the consequence of bad choices not our own.