RX for states: Expand Medicaid -- June 13, 2013 column

By MARSHA MERCER 

“Americans can always be counted on to do the right thing – after they have exhausted all other possibilities,” Winston Churchill supposedly said.

Whether the remark reflected Churchill’s or someone else’s wit, we again are seeing Americans struggle over the right thing. This time the right thing is for every state to expand Medicaid, the joint federal-state health insurance program for the poor.  

Medicaid currently provides health care to about 59 million low-income people – mostly young children and their parents and pregnant women. It pays for long-term care for seniors in nursing homes and people with disabilities. Some states, like Massachusetts, expanded Medicaid coverage on their own.

In March 2010, President Barack Obama signed the Affordable Care Act – a.k.a. Obamacare – which aims to bring affordable health care to most Americans no matter where they live.

The law is making significant changes. Next year, insurance companies can no longer discriminate against people with pre-existing health conditions, and almost every American will have to have health insurance or pay a tax penalty. The law also required every state to expand Medicaid to cover people with incomes up to 133 percent of the federal poverty level, about $26,000 for a family of three in 2013. The Congressional Budget Office said the Medicaid expansion would provide 16 million Americans with reliable health care.   

Republican state officials challenged the law in the courts. Last June, the Supreme Court upheld the law but said expanding Medicaid was a state option. Today 22 states and the District of Columbia are moving forward with the Medicaid expansion, according to the Kaiser Family Foundation. These include California, Minnesota, New Jersey and New York.

About 20 states have rejected the expansion – at least for now. Among them are Alabama, Florida, North Carolina, Oklahoma, Texas and Virginia. Eight other states around the country are still fighting it out.

In five Deep South states that have opted out – Alabama, Georgia, Mississippi, Louisiana and South Carolina – 62 percent of residents support the Medicaid expansion, a poll in March and April by the Joint Center for Political and Economic Studies found. The center is a public policy research group that focuses on African Americans.

Virginians were almost evenly split in March with 45 percent favoring expansion and 43 percent opposed, a Quinnipiac University poll reported.    

States that have rejected the expansion have some of the nation’s worst health records. America’s Health Rankings, an annual report by United Health Foundation, ranked Mississippi and Louisiana 49^{th,  --} the least healthy states. Alabama is 45^th and Virginia 21^st.

The states are forgoing “free” money. The federal government will foot 100 percent of Medicaid expansion costs from 2014 to 2016. Repayment will drop  to 90 percent in 2020 and level off after that. That’s a much better match than states currently have for Medicaid. The federal share ranges from 50 percent to 83 percent, with poorer states getting higher amounts per capita.   

Critics of expansion say they worry about unspecified costs down the road, and yet people without health insurance get health care every day in more costly hospital emergency rooms.    

A new Rand study of the first 14 states whose governors declared they would not expand Medicaid, including Alabama, found those states together would spend $1 billion more on uncompensated health care in 2016 than if they expanded Medicaid. The 14 states would give up $8.4 billion annually in federal payments, Rand said.

An analysis of state health data by the Los Angeles Times indicates that the states could use the help. Colon cancer deaths in states that oppose the Medicaid expansion are, on average, 16 percent higher than in states that support expansion, and deaths from breast cancer are 8 percent higher on average in states that oppose the expansion.

“Medicaid by itself may not close those gaps, which also reflect income and education disparities,” the paper reported, noting that conservatives argue that poor people would be helped more by alternative strategies that encourage people to take responsibility for their own health care.

States that don’t expand Medicaid still face other higher costs. Nationwide, only about two-thirds of people eligible have signed up for Medicaid, and the new health law includes a major outreach effort.

The fight over Medicaid is far from over. There’s no deadline for expansion, and supporters say they’ll be back in statehouses for the next legislative session. As they say in baseball, there’s always next year.

For now, though, it appears many states are determined to ignore the proverb and be “penny wise and pound foolish.”   

©2013 Marsha Mercer. All rights reserved.