More Reasons to Pass on Medicaid Expansion

Elected officials are standing strong in their opposition to the Medicaid expansion under the Affordable Care Act, despite a number of “independent studies” touting the benefits of “free money” from the federal government and constant lobbying by the health care industry.

Last week, State House Republicans introduced their 2013-2014 budget proposal, devoid of Medicaid expansion. House Appropriations Chairman Rep. Bill Adolph stated, “When and if the governor decides to expand Medicaid, then we’re going to be taking a look at those figures.”

Here are a couple reasons to pass on Medicaid expansion.

Medicaid doesn’t make people healthy. An Oregon study designed to figure out whether Medicaid patients are healthier than the uninsured found no evidence that Medicaid improves the physical health of enrollees.

This randomized, controlled study showed that Medicaid coverage generated no significant improvements in measured physical health outcomes in the first two years, but it did increase use of health care services, raise rates of diabetes detection and management, lower rates of depression, and reduce financial strain.

Estimated Medicaid expansion savings are significantly skewed. Department of Public Welfare Secretary Beverly Mackereth challenged rosy predictions cited in the Independent Fiscal Office’s analysis.

Overall, the Department has serious concerns regarding several assumptions included in the report . . . the IFO report contains what we believe to be several material problems that merit further review and analysis before the report’s conclusions could be relied upon.

Altogether, she estimates the IFO overstates savings by about $515 million for 2014. Why the difference? Mackereth contends the analysis underestimates needed staff and training costs, underestimates the number of Pennsylvanians who will sign up for coverage, and overestimates the savings from moving patients from state programs onto Medicaid, where they qualify for more “federal dollars”.

Finally, we still don’t know what’s in the bill. Last week we learned from Senator Jay Costa that federal officials will force children enrolled in CHIP (Children’s Health Insurance Plan) to enroll in Medicaid regardless of whether Pennsylvania expands [pay wall]. Even the Governor’s office was unaware of this provision until recently. Unlike Medicaid, CHIP patients can choose from a wide variety of private plans, which the government subsidizes on a sliding scale. Kicking kids off CHIP could force families to find new doctors since many CHIP doctors do not accept the lower Medicaid reimbursements.

Governor Corbett should reject any expansion to avoid what Michael Cannon calls a “fiscal timebomb” in the Morning Call and pursue Medicaid reform that improves outcomes by giving patients choice and control.