Overview of Findings
ObamaCare’s Medicaid expansion has flooded state welfare rolls with more able-bodied adults than supporters said would ever sign up. As a result, funding for the truly needy, education, infrastructure, and public safety are now at direct risk.
A 2012 U.S. Supreme Court decision allowed states to choose whether or not they wanted to accept ObamaCare’s expansion of Medicaid to a new class of working-age, able-bodied, childless adults. States that opted in have seen much faster welfare growth than they bargained for.
This enrollment explosion will soon unleash a fiscal crisis. Unlike the federal government, states cannot print their own money and, starting in January 2017, states’ share of Medicaid expansion costs will increase to 5 percent. Assuming the federal government keeps its funding promises – which is in question – state costs will gradually rise to 10 percent by 2020. With expansion enrollment and per-enrollee costs rising higher and faster than ObamaCare advocates promised, those costs will rapidly swamp state budgets.
Medicaid expansion already makes welfare for able-bodied adults a higher priority than services for the nearly 600,000 seniors, children with developmental disabilities, individuals with brain injuries, and other vulnerable individuals currently languishing on waiting lists for needed Medicaid services. Mounting overruns will soon exacerbate pressure on policymakers to shift even more money away from the truly needy and towards ObamaCare’s able-bodied adults.