Bait-and-Switch: Idahoans Were Misled on ObamaCare Expansion and Are Getting a Raw Deal
THE BOTTOM LINE:
IDAHO LEGISLATORS SHOULD WITHDRAW FROM OBAMACARE AND THROW OFF THE NEW MEDICAID HANDCUFFS.
Idaho taxpayers are getting a raw deal
After the Supreme Court declared states’ decisions to expand Medicaid under ObamaCare optional, Idaho legislators considered the ramifications for the state but found that expansion would be cost prohibitive.1National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012)–2Healthcare Alternatives for Citizens below 11 percent of Poverty Level Work Group, “Meeting materials for healthcare alternatives for citizens below 100 percent of poverty level,” Idaho Legislature (2016), https://legislature.idaho.gov/sessioninfo/2016/interim/hacp-materials–3Mike Price, “New bill would create waiver system in place of Medicaid expansion,” EastIdahoNews.com (2018), https://www.eastidahonews.com/2018/01/new-bill-creates-waiver-system-place-medicaid-expansion Unfortunately, ObamaCare expansion activists disregarded the work of the legislature and instead advanced the untenable agenda through a ballot initiative.4Kimberlee Kruesi, “Advocates file Idaho Medicaid expansion ballot initiative,” Associated Press (2017), https://apnews.com/article/9c49329814c441e6b724148b3e52e0f0
The results have been disastrous, with enrollment and costs shattering expectations. And while expansion was ultimately approved by the voters, only a minority of registered voters supported the initiative. The Idaho State Legislature then proceeded to reluctantly implement expansion, but only after making meaningful alterations. 5Support for Proposition 2 only registered 365,107 votes out of 917,612 registered voters. See for example: https://sos.idaho.gov/elect/results/2018/General/statewide_totals.html–6Idaho Legislature, Senate Bill 1204 (2019), https://legislature.idaho.gov/sessioninfo/2019/legislation/s1204
But now, the legislature’s changes are unlikely to survive under a hostile Biden administration, meaning the cost overruns Idaho has already experienced are going to continue. And thanks to even more restrictions from Washington, D.C., the situation has become worse.
Idaho is not getting the ObamaCare expansion it expected. It is time for lawmakers to cut the state’s losses and end participation in this failed experiment.
Idaho ObamaCare expansion has run off the rails
Virtually everywhere it has been tried, ObamaCare expansion has blown through enrollment projections.7Nicholas Horton and Jonathan Ingram, “Obamacare expansion enrollment is shattering projections,” Foundation for Government Accountability, (2016), https://thefga.org/paper/obamacare-expansion-enrollment-is-shattering-projections-2 The situation in Idaho is no different—but this is a far cry from what Idaho voters were promised.
When Idahoans went to the polls in 2018, they were told ObamaCare expansion would only cover an additional 62,000 Idahoans.8Lawerence Denny, Idaho Secretary of State, “2018 voters’ pamphlet,” Idaho Secretary of State, (2018), https://sos.idaho.gov/elections-division/ballot-initiatives But according to the latest numbers, actual enrollment is already 95 percent higher than promised.9Lawerence Denny, Idaho Secretary of State, “2018 voters’ pamphlet,” Idaho Secretary of State, (2018), https://sos.idaho.gov/elections-division/ballot-initiatives–10Idaho Department of Health & Welfare, “Idaho Medicaid expansion: Expansion enrollment by county,” Idaho Department of Health & Welfare, (2021), https://publicdocuments.dhw.idaho.gov/WebLink/DocView.aspx?id=14388&dbid=0&repo=PUBLIC-DOCUMENTS
And this is just the beginning. Enrollment in fiscal year 2022 is now projected to be even higher than previously thought.13Ben Diederich, Davis Burge, and Stacy Albrecht, “Milliman report – Idaho expansion budget forecast – December 2020,” Milliman, (2020), https://publicdocuments.dhw.idaho.gov/WebLink/browse.aspx?id=15114&dbid=0&repo=PUBLIC-DOCUMENTS
ObamaCare expansion is leading the way to greater dependency in Idaho. More than 121,021 Idahoans, 30 percent of total Medicaid enrollment, are enrolled as part of the newly eligible population.14Idaho Department of Health & Welfare, “Idaho Medicaid expansion: Expansion enrollment by county,” Idaho Department of Health & Welfare, (2021), https://publicdocuments.dhw.idaho.gov/WebLink/DocView.aspx?id=14388&dbid=0&repo=PUBLIC-DOCUMENTS All told, total Medicaid enrollment has spiked 66 percent since ObamaCare expansion took effect.15Kaiser Family Foundation, “Total monthly Medicaid/CHIP enrollment and Pre-ACA enrollment,” Kaiser Family Foundation (2021), https://www.kff.org/health-reform/state-indicator/total-monthly-medicaid-and-chip-enrollment/?currentTimeframe=0&selectedRows=%7B%22states%22:%7B%22idaho%22:%7B%7D,%22wyoming%22:%7B%7D%7D%7D&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D
By contrast, in neighboring Wyoming—which has refused ObamaCare expansion—the increase in Medicaid enrollment has been more modest and focused on the truly needy.16Kaiser Family Foundation, “Total monthly Medicaid/CHIP enrollment and Pre-ACA enrollment,” Kaiser Family Foundation (2021), https://www.kff.org/health-reform/state-indicator/total-monthly-medicaid-and-chip-enrollment/?currentTimeframe=0&selectedRows=%7B%22states%22:%7B%22idaho%22:%7B%7D,%22wyoming%22:%7B%7D%7D%7D&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D
Thanks to the legislature rejecting ObamaCare expansion, Medicaid is consuming a far smaller proportion of Wyoming’s overall budget—freeing up funds to go towards other priorities like education, transportation, and public safety.18National Association of State Budget Officers, “2020 state expenditure report (Fiscal 2018-2020 Data),” National Association of State Budget Officers, (2020), https://www.nasbo.org/reports-data/state-expenditure-report/state-expenditure-archives
These higher levels of government dependency in Idaho are concerning on their own, but they also bring major cost increases. Medicaid already accounts for more than 27 percent of Idaho’s total budgetary expenditures.21National Association of State Budget Officers, “2020 state expenditure report (fiscal 2018-2020 data),” National Association of State Budget Officers, (2020), https://www.nasbo.org/reports-data/state-expenditure-report/state-expenditure-archives As enrollment swells, Medicaid is going to eat up an even greater portion of Idaho’s budget.
The exploding costs of Medicaid are going to be even more difficult to pay for when the budget “off- sets” never materialize. Proponents of ObamaCare expansion claimed it would generate savings to the state’s Catastrophic Care Fund.22Idaho Center for Fiscal Policy, “Key facts about the impact of Medicaid expansion on Idaho’s state budget,” Idaho Center for Fiscal Policy (2019), https://idahocfp.org/key-facts-about-the-impact-of-medicaid-expansion-on-idahos-state-budget But early evidence shows that program expenditures did not decline as anticipated.23Division of Financial Management, “Catastrophic health care post Program,” State of Idaho (2021), https://dfm.idaho.gov/publications/exec/budget/performance.php?year=2022
Budget-busting ObamaCare expansion is proving to be more expensive than advertised—and it is thanks to empty promises by expansion advocates who circumvented the legislature.
ObamaCare expansion skirted the legislative process, to the detriment of Idahoans
Unable to advance ObamaCare expansion through the legislative process across the country, the Left has resorted to circumventing lawmakers.24Nicholas Horton and Hayden Dublois, “They are coming for you next: How the Left is circumventing state legislatures to expand welfare,” Foundation for Government Accountability, (2021), https://thefga.org/paper/medicaid-expansion-ballot-initiative This is the tactic activists pursued in Idaho with a ballot initiative in 2018.25Mike Price, “A look at Medicaid expansion and Proposition 2,” EastIdahoNews.com (2018), https://www.eastidahonews.com/2018/11/a-look-at-medicaid-expansion-and-proposition-2
The main driver behind the effort was Reclaim Idaho.26Reclaim Idaho, “Medicaid expansion,” Reclaim Idaho, https://www.reclaimidaho.org/medicaid They were joined by Idahoans for Healthcare, a group that received more than $400,000 from out-of-state donations, including from the progressive, activist Fairness Project.27Idaho Secretary of State, “Scanned campaign finance reports,” Idaho Secretary of State (2018), https://sos.idaho.gov/elect/finance/2018/this_year_measure_and_miscellaneous_committees.html. See for example, Idahoans for Healthcare Pre-General scanned report https://sos.idaho.gov/elect/finance/2018/Pre-General/10145.pdf–28Fairness Project, “Our campaigns, Our ballot measure campaigns,” Fairness Project (2022), https://thefairnessproject.org/ballot-measure-campaigns
It is more beneficial that bills go through the legislative process because they are vetted by multiple committees, have their fiscal impacts reviewed and considered, and experts have an opportunity to share testimony before legislators—the representatives of the people—vote. The ObamaCare expansion effort failed to pass muster through that deliberative process. And that is why out-of-state groups had to use a deceptive message, one that has been proven false, to enact their radical agenda through another means.
Idaho’s ObamaCare expansion narrowly passed
In a state with a population of 1.8 million, ObamaCare expansion received a scant 365,107 votes in the general election.29Idaho Secretary of State, “November 6, 2018 General Election results – statewide totals,” Idaho Secretary of State, (2018), https://sos.idaho.gov/elect/results/2018/General/statewide_totals.html–30U.S. Census Bureau, “QuickFacts Idaho,” U.S. Department of Commerce (2019), https://www.census.gov/quickfacts/ID Total votes in favor of the ballot measure represented only 40 percent of registered voters in Idaho.31Author’s calculations based on the number of ballots cast in favor of Proposition 2 and the number of registered voters as reported by the Idaho Secretary of State for the November 6, 2018 General Election. See for example: https://sos.idaho.gov/elect/results/2018/General/statewide_totals.html
Support only reached a majority of registered voters in two of Idaho’s 44 counties, Blaine County and Teton County—a far cry from a sweeping mandate.32Author’s calculations based on the number of ballots cast in favor of Proposition 2 by county and the number of registered voters by county as reported by the Idaho Secretary of State for the November 6, 2018 General Election. See for example: https://sos.idaho.gov/elect/results/2018/General/statewide_totals.html
Idaho will not get the flexibility legislators sought
With their hands tied by the initiative results, lawmakers were prepared to expand Medicaid under the pretenses that they would have certain flexibilities—like commonsense work requirements—to limit the harm of ObamaCare expansion. But those flexibilities never came to fruition. Now with a hostile Biden administration, the fate of work requirements is clear. The Centers for Medicare and Medicaid Services (CMS) has already yanked back work requirements in Ohio, South Carolina, and Utah, demonstrating the administration’s favor for policies that foster government dependency.33Christopher Brown, “HHS revokes Medicaid work requirements in three more states,” Bloomberg Law (2021), https://news.bloomberglaw.com/health-law-and-business/hhs-revokes-medicaid-work-requirements-in-three-more-states?context=search
Despite the good intentions of the legislature, Idaho also will not be able to fix expansion with a Section 1332 waiver. For one thing, the Biden administration has already asserted that it does not support state flexibility.34Trevor Carlsen, “Don’t expect any state flexibility under Obama 2.0,” RealCelearHealth, (2021), https://www.realclearhealth.com/articles/2021/03/24/dont_expect_any_state_flexibility_under_obama_20_111179.html But even if the administration were favorable to such an approach, as the Trump administration was, Section 1332 allows about as much flexibility as a straitjacket.35Jonathan Ingram and Nicholas Horton, “The ObamaCare straightjacket – Section 1332 waivers are a fool’s errand, not an ObamaCare escape hatch,” Foundation for Government Accountability (2015), https://thefga.org/paper/the-obamacare-straightjacket-section-1332-waivers-are-a-fools-errand-not-an-obamacare-escape-hatch
When Idaho moved forward with expanding Medicaid, they thought they were at least including some guard rails. But instead, all they got was a massive expansion of welfare. The best thing Idaho can do now is look out for themselves—and the truly needy—and opt out of this raw deal.
Ineligible expansion enrollees are costing the state even more
Washington, D.C. also put new handcuffs on the Idaho legislature with a misguided pandemic- related policy that has turned out poorly thanks to ObamaCare expansion. Under the Families First Coronavirus Response Act (FFCRA), all states, including Idaho, were offered a 6.2 percent increase in federal matching funds for traditional Medicaid.36Public Law 116-127 (2020), https://www.congress.gov/116/bills/hr6201/BILLS-116hr6201enr.pdf But for Idaho to receive these funds, the state is restricted from making any changes in eligibility or enrollment guidelines in its Medicaid program during the pandemic.37Jonathan Ingram, Nicholas Horton, and Sam Adolphsen, “Extra COVID-19 Medicaid funds come at a high cost to states,” Foundation for Government Accountability (2020), https://thefga.org/paper/covid-19-medicaid-funds/ Thanks to the continued renewal of the “public health emergency” this increase has become a permanent fixture of the state’s Medicaid financing structure—at least for as long as Idaho opts into the deal.38Xavier Becerra, “Renewal of determination that a public health emergency exists,” U.S. Department of Health and Human Services (2021), https://www.phe.gov/emergency/news/healthactions/phe/Pages/COVDI-15Oct21.aspx
Instead of helping, the policy has already cost Idaho taxpayers more than $20 million per month.39Author’s calculation based on the value of the 6.2 percentage-point federal matching bump, the estimated proportion of new Medicaid enrollees who are no longer eligible for the program relative to total enrollment, the estimated eligibility group distributions of ineligible recipients, and the per member per month costs of these recipients. Under these so-called Maintenance of Effort (MOE) restrictions, Idaho cannot remove ineligible people from enrollment—even for the ObamaCare expansion population of able-bodied adults for whom the increase in matching funds does not apply.40Author’s calculation based on the value of the 6.2 percentage-point federal matching bump, the estimated proportion of new Medicaid enrollees who are no longer eligible for the program relative to total enrollment, the estimated eligibility group distributions of ineligible recipients, and the per member per month costs of these recipients. There are an estimated 83,000 ineligible enrollees in Idaho as a result of these handcuffs.41Hayden Dublois and Jonathan Ingram, “The Medicaid crisis is here: How congressional handcuffs are causing Medicaid to implode,” Foundation for Government Accountability (2022), https://thefga.org/paper/congressional-handcuffs-causing-medicaid-to-implode Idaho is unable to remove ineligible people from the program or encourage self-sufficiency with work search requirements, and taxpayers are left paying more for a government dependency program instead of helping the truly needy.
THE BOTTOM LINE: Idaho legislators should withdraw from ObamaCare expansion and throw off the new Medicaid handcuffs.
Policymakers in Idaho, not bureaucrats in Washington, D.C., are responsible for the Idaho state budget. Idaho legislators proceeded with ObamaCare expansion on the grounds that they would have certain flexibilities to run the program in ways that work for Idaho. But President Biden’s bullies refuse to grant Idaho those flexibilities. The signals they have already sent to other states make it unlikely expansion will ever resemble what Idaho had in mind.
Between ObamaCare expansion and new restrictions from the Biden administration, the state- federal partnership that is supposed to define the Medicaid program has been flipped on its head. Instead, control of Medicaid has been ceded to bureaucrats in Washington, D.C., while Idahoans are left to deal with the consequences of bad federal policy.