Medicaid has turned 50, and it’s still the subject of national debate as states wrestle with the pros and cons of expanding the reach of this insurance under Obamacare.
One in four Americans, about 70 million people, rely on the program for their health care coverage. Even without expanding, Georgia pays a large sum into its state share to fund its traditional program. Nearly 2 million Georgians benefit from Medicaid and PeachCare at cost of $2.9 billion a year.
To account for enrollment growth, the current state budget includes $60 million in new spending for Medicaid and PeachCare. These programs will receive an additional $46 million to cover the cost of Affordable Care Act mandates.
As debate over Medicaid expansion continues around the country, we are beginning to see cautionary tales emerge from “expansion states.” Unlike the federal government, Georgia and the vast majority of states operate on a balanced budget. Aside from health care, we must balance funding for other critical areas like education and transportation while at the same time growing our Rainy Day Fund. Expanding Medicaid makes this impossible without raising taxes or cutting services.
According to the Associated Press, more than a dozen states that expanded Medicaid have seen enrollments surge far beyond initial estimates. This is raising concerns about how added costs will impact their budgets, especially as federal aid is reduced in the coming years.
In Kentucky, some 311,000 new people enrolled in 2014, more than double the original estimate. As a result, its 2017 cost projections for the state’s share of the Medicaid expansion doubled to $74 million from $33 million. According to Forbes, other states like Illinois, Ohio and Michigan have all seen their expansion costs increase dramatically, far beyond original predictions.
At the same time, a recent Moody’s report shows that nonprofit hospitals haven’t benefited from financial relief that expansion was supposed to provide. Last year, the Journal of the American Medical Association ran a study that found only half of physicians were accepting new Medicaid patients.
Because coverage doesn’t equal access, Medicaid expansion has made it harder for beneficiaries to see a physician. As a result, some of these patients are seeking care in emergency rooms, which is exactly what Medicaid expansion was supposed to prevent. A Colorado Hospital Association report found increases in ER usage up 5.6 percent in expansion states compared to 1.8 percent in those with traditional Medicaid programs.
Medicaid’s milestone anniversary provides federal lawmakers an opportunity to address serious challenges to the long-term sustainability of this critical safety net. Providing block grants to states would increase flexibility and allow for more control of program services, requirements and delivery methods. It incentivizes states and health care providers to transform the way care is delivered while controlling costs. This will result in better outcomes for our most vulnerable patients.
Finally, providing people with good-paying jobs is crucial to ensuring Medicaid’s viability so that it can continue to help those who need it most. With job creation as my primary focus since taking office, we’ve created more than 390,000 private-sector jobs for Georgians. We will measure our success not by how many people we add to Medicaid but by how many no longer require it.
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