The biggest selling point for President Obama's health care law was that 30 million uninsured people would get coverage, about half through private insurance and half through an expansion of Medicaid, the federal-state program for the lowest-income Americans.
Now, in too many states, the Medicaid portion is in serious jeopardy. Thanks to last June's Supreme Court ruling that made the expansion optional for states, a group of Republican governors and legislators has opened a new front in their ideological war against ObamaCare -- at the expense of their poorest residents, their state's hospitals and their own state budgets.
This is remarkably crass politics, especially when you consider that some of the governors leading the charge -- Rick Perry of Texas, Bobby Jindal of Louisiana and Nikki Haley of South Carolina-aapreside over states with some of the nation's highest percentages of uninsured residents.
Texas is No. 1 (27% uninsured), and Louisiana and South Carolina are tied for No. 5 (23% uninsured). Handed a golden opportunity to fix this, Perry, Jindal, Haley and more than a dozen other governors are saying no, blocking an estimated 5 million people from obtaining coverage.
The governors' chief objection is that the Medicaid expansion is unaffordable, but their arguments are unconvincing. Let's look at the facts.
Medicaid serves the poorest Americans, and nearly one-third of the money goes toward long-term care for the elderly and disabled. ObamaCare would expand eligibility next year to people making up to 138% of the poverty level, about $32,500 a year for a family of four. States usually pay about 50% of Medicaid costs, but the federal government would pick up the entire cost of the expansion for the first three years. After that, the state share for the expanded population would gradually rise to just 10% by 2020 and stay there.
And what if Washington reneges on that cost-sharing agreement, as the resisters fear? States would be free to drop the coverage.
Hospitals would also benefit from expansion, which is why so many are lobbying hard for it. More people with coverage means fewer desperately poor people showing up at hospitals, which have to treat them but often can't collect any payment.
States and the federal government typically share the costs of reimbursing hospitals for this "uncompensated care," but ObamaCare cuts the federal payments in half because most people would have insurance. States that don't expand Medicaid would have to pick up the slack.
Some Republican governors aren't fans of ObamaCare but see expanding Medicaid as a matter of basic decency. In Florida, Gov. Rick Scott says he now favors expansion because he could not "in good conscience deny the uninsured access to care." In Ohio, Gov. John Kasich quotes the Bible's command to help "the least among us."
Other governors want to let private insurance participate in the Medicare expansion, and the Obama administration hasn't ruled this out. But it's hard to see how adding a middleman would be more efficient. The Congressional Budget Office says Medicaid can cover a patient for $6,000 a year in 2022, while the cost of private insurance would be $9,000, or fully 50% more.
The fight over expanding Medicaid has a familiar ring. Several states refused to join the program when it began in 1966, and many of their most vulnerable citizens suffered needlessly before all states eventually signed up. It would be a shame for that history to repeat itself.
Texas Medicaid Matters protest, in Austin on March 5, calls for expansion.
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