Eight Reasons ObamaCare’s Medicaid Expansion is Wrong for Montana

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EXECUTIVE SUMMARY

In its June 2012 decision to uphold the federal Patient Protection and Affordable Care Act, commonly known as ObamaCare, the U.S. Supreme Court also held that states were not required to implement an expansion of Medicaid, which the law initially mandated. This leaves Montana policymakers with a choice; accept federal funding to expand Montana Medicaid to cover able-bodied, working-age adults with no children or reject ObamaCare’s optional Medicaid expansion. The wisest course is for Montana to reject the Medicaid expansion for the following eight reasons:

1. ABLE-BODIED CHILDLESS ADULTS HAVE NEVER BEEN—AND WERE NEVER INTENDED TO BE—ELIGIBLE FOR TAXPAYER-FUNDED MEDICAID.

Medicaid was created to be a health care safety net for the most vulnerable: the elderly, individuals who are blind or disabled and low-income families. A recent poll found that 77 percent of Americans oppose providing Medicaid for working-age adults without kids.

2. MONTANA LAWMAKERS HAVE NO RELIABLE COST ESTIMATES.

A series of projections have been released predicting the cost of expanding Montana Medicaid, but modest differences in enrollment assumptions and costs to provide care for the newly-eligible populations have resulted in a wide range of estimates. Because of the lack of agreement among these projections, no reliable estimate of the true cost of Medicaid expansion exists.

3. MEDICAID COSTS ARE ALREADY GROWING RAPIDLY AND EXPANSION WOULD JEOPARDIZE OTHER STATE PRIORITIES.

Montana’s Medicaid welfare spending is already unsustainable. The program’s annual costs skyrocketed to $1.1 billion in 2012, up from just $563 million a decade earlier. Even without expanding Medicaid, costs for the program are expected to grow to $2.2 billion by 2022.

4. MEDICAID IS ALREADY FAILING MONTANA’S MOST VULNERABLE PATIENTS.

Medicaid patients already face a declining number of doctors who are accepting new Medicaid patients, primary care doctor shortages in 34 of Montana’s 56 counties, poor access to specialists and worse health outcomes. Dumping tens of thousands more people into the program will make these problems worse for truly vulnerable Montana Medicaid patients.

5. EXPANDING MEDICAID IS UNLIKELY TO REDUCE HOSPITALS’ UNCOMPENSATED CHARITY CARE.

Although supporters of ObamaCare’s optional Medicaid expansion promise a reduction in uncompensated charity care, actual experiences of other states that previously expanded Medicaid confirm expansion has little impact and those promises are unlikely to be kept.

6. MEDICAID EXPANSION CROWDS OUT PRIVATE HEALTH COVERAGE.

ObamaCare proponents promise a reduction in the number of Montanans without health coverage if policymakers expand Medicaid. But other states saw a huge number of individuals drop their private insurance to enroll in Medicaid after previous expansions, while the rate of uninsured residents was essentially unchanged.

7. THE FEDERAL GOVERNMENT IS UNLIKELY TO KEEP ITS FUNDING PROMISES TO MONTANA.

ObamaCare promises to fund 100 percent of Montana’s Medicaid expansion costs to 2016 and 90 percent thereafter, indefinitely. With federal debt already standing at more than $17 trillion—and expected to grow to more than $26 trillion in the next decade—and a poor record of keeping past promises, it is highly unlikely Washington will be able to keep its new promises to Montana and probable that expansion costs will be passed down to the state taxpayers.

8. IT IS UNLIKELY MONTANA WILL EVER BE ABLE TO SCALE BACK THE SIZE OF ITS MEDICAID PROGRAM IF IT DECIDES TO EXPAND.

Expanding Medicaid to able-bodied childless adults may turn this group of people into a “mandatory population” for Montana and make it difficult, if not impossible, to discontinue providing taxpayer-funded Medicaid to those childless adults unless policymakers exit the Medicaid program entirely.

ObamaCare supporters want Montana policymakers to overload the state’s broken Medicaid system with tens of thousands of able-bodied, working-age adults with no kids, but doing so poses too great a risk to the most vulnerable patients Medicaid was created to protect. A more responsible approach is for Montana to reject Medicaid expansion and instead refocus efforts on fixing the current program so that it works for patients and taxpayers.