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  • Side Effects: Obamacare Encourages States to Drop Medicaid

    Because of Obamacare, states are considering dropping out of Medicaid, the federal-state health program for the poor, rather than deal with the additional fiscal strain resulting from the health law.

    One of the main drivers behind health care reform was to reduce the nation’s number of uninsured.  Under the new law, this will be partially achieved by adding 18 million Americans to the Medicaid program.

    This expansion will strain already hurting state budgets.  By expanding a program for which states share the cost, the federal government is able to hide the true cost of the expansion while draining state coffers, at the expense of other state spending priorities.

    This cost shift strategy to the states is pushing some states to consider dropping Medicaid altogether. The New York Times reports that Texas is already considering this route. Texas Rep. Warren Chisum (R-District 88) said the state will be restricted in how it can otherwise cut costs. “With Obamacare mandates coming down, we have a situation where we cannot reduce benefits or change eligibility,” he said in the article. “This system is bankrupting our state.”

    Heritage insurance expert Ed Haislmaier’s analysis shows that Texas could save $46.5 billion between 2014 and 2019 by dropping acute care coverage and continuing to cover long-term care services with state dollars. Altogether, 40 states and the District of Columbia could achieve net savings by following suit. (Note: The numbers stated above reflect updates to Haislmaier’s research since the health law’s passage.)

    State Sen. Jane Nelson (R-District 12) said in the Times article that “dropping out of Medicaid was worth considering—but only if it made fiscal sense without jeopardizing care.”  Starting in 2014, this could be the reality. The new law will then begin offering generous subsidies to all Americans earning less than 400 percent of the federal poverty level to buy insurance in the exchanges.

    The subsidies are not available to Americans who are eligible for Medicaid or have access to employer-sponsored insurance. But it’s already clear that the law’s incentives encourage employers to drop health coverage and move employees toward subsidized health plans within the exchange. States have a similar incentive to drop Medicaid: especially if beneficiaries who are no longer eligible for the program would become eligible for subsidies through the exchange.

    The loser in this equation is the federal taxpayer. As Haislmaier writes, “[T]he federal government, however, would be left holding a trillion dollar plus tab.” The Medicaid provision is one more example of Congress failing to consider the consequences of a massive overhaul to the health sector. All the more reason for lawmakers to scrap Obamacare and get health care reform right.

    Posted in Obamacare [slideshow_deploy]

    16 Responses to Side Effects: Obamacare Encourages States to Drop Medicaid

    1. Mary Ratcliff, Amari says:

      We prayed so hard for a republican mandate from voters in Texas. I'm worried that folks like Warren Chisum are causing a big 'ol distraction. Y'all know that we have to pray for our legislators to get along in order to bring salvation to our Capitol in Austin with Joe Straus on the dias.

    2. Pingback: Must Know Headlines 11.10.2010 — ExposeTheMedia.com

    3. W.P.Koch,San LuIs Ob says:

      WHAT SHOULD HAPPEN

      Congress and the White House should stop squandering the people’s money and use savings to improve quality of basic invested entitlements. Preserve the 2010 tax schedule. Congress should improve basic Medicare. Vote opponents to this “out”. Citizens come first.

      It is time the U.S. reduces its human rites and police activities for the World by lobbying the United Nations, NATO and Interpol to “take on more”. 800 bases in 63 countries across the world should be reduced. Starting with Iraq, continue training for self reliance. After a surge in Afghanistan repeat above and remove corruption starting with monitoring accounts, substituting minerals mining and food crops for drugs.

      If we stay make them pay. Decrease forces in selected areas such as Germany, Bosnia and Okinawa.

      Cut bloated federal bureaucracy. Combine CDC, EPA and FDA. Combine the FAA, NHTSA and Transportation Department. Combine GAO and CBO. Phase in outsourcing. Departments should eliminate “must spend all”. Return “unused” yearly budget to the treasury.

      Eliminate all 32 CZARS Mr. president. Reduce your 469 member staff which makes nearly 39 million per year! Halt first lady $180,000 air force one vacation trips. Cancel $ 20,000,000 executive order (HB 1388) to relocate key Hamas members to U.S… Stop “$200 million per day” presidential foreign trips.

      Contribute to only one of: The World Bank or International Monetary Fund or U.S. Agency for International Development.

      Reduce foreign aid bribery. For example, no aid to oil rich -Iraq. $37 billion and increasing with $8.7 billion of Iraq development funds not accounted for.

      Charge bailed companies (TARP) for their huge executive bonuses at taxpayer expense. Government should sell its shares to recoup for taxpayer. About $154 billion owed.

      Congress should reduce the “stimulus” and monetary expenditures by halting: over budget projects, non relevant earmarks and vote bribery. Do not pay student loans for congressional staff. Please- no private or military jets for congress including Pelosi’s family at taxpayer expense. $2.1 million for Pelosi over 2 years. Congress should set commercial travel cost standards and controls.

      Reduce medical cost by: allowing purchasing anywhere in U.S., “tort reform”, and reducing “red tape”. Trace funds to local medical groups for expediting billing cost speed, doctor/patient verification and fraud reduction.

      Federal government should enforce existing immigration laws. Complete the improved fence. Entitlements or benefits should be for only citizens. Deport criminal “illegals”. Only workers on a Visa Program qualify for needed medical benefits

      Improve medical expense tax deduction for citizens reaching age 65. Provide corporations tax reduction incentives for hiring with healthcare.

      The savings will improve funding for:” Medicare”, “Medicaid, and “Veteran’s Affairs”.

      Healthcare quality should be at least that for Congress or the Federal Employee Health Benefits Program (FEHBP). Additional benefits are: dental coverage, improved visual coverage, no drug “donut hole”, no deductibles and co-pays except for extended skilled level nursing.

      These actions will allow aid for unemployment compensation and Social Security with reinstated cost of living increases.

    4. Paul Terry Stone says:

      The Federal government made it hard on itself by burdening Medicaid more than it is currently. Many states will have to withdraw entirely for fiscal reasons leaving the U. S. government to have to take over the program entirely or do without.

    5. ChrisM, Austin TX says:

      I hope the State of Texas does opt out of Medicaid. This should be handled at the state level. State Senator Jane Nelson, who heads the Senate Public Health Committee, said "dropping out of Medicaid was worth considering – but only if it made fiscal sense without jeopardizing care". (http://www.texasinsider.org/?p=37231) I see all these minute clinics, urgent care clinics, etc. popping up all over the place. I think the State, either by utilizing these clinics or by establishing more state run Health Department clinics or a combination of the two, to meet the needs of those who don't have insurance and empower emergency rooms to refuse service & refer non emergency care to those clinics. This alone would go a long way lower the cost of state run Medicaid. Oh, and Mary- Joe Straus is a liberal and must be unseated as Speaker.

    6. CUTIE says:

      tHIS WHOLE MESS IS OUT OF SIGHT. tHIS IS THE ONLY REASON OBOMBA WANTED TO BECOME PRESIDENT ! THIS MAN SHOULD BE IMPEACHED IMMEDIATELY ! HE HAS CAUSED NOTHING BUT TROUBLE EVER SINCE HE TOOK OFFICE! HE IS A DISGRACE TO THE AMERICAN PEOPLE ! HOW CAN STATES SAY THEY ATE GOING TO DROP MEDICAD FOR THE POOR. THESE PEOPLE HAVE NO HEART ! SURE LIVE INA SICK WORLD !!!!!

    7. Dave Aldridge says:

      Sounds like W.P. Koch has the right ideas, now just get them to accept them and make them work. It will be one uphill fight against all the government unions.

    8. jc shipley dyersburg says:

      I agree with W. P. Koch, Let's run that man for President

    9. Pingback: Side Effects: Obamacare Encourages States to Drop Medicaid

    10. Randy 131 from Flori says:

      How about the government get out of healthcare and let the private sector handle it with free enterprise's supply and demand theories to contol costs. Every thing the government gets involved with it screws up and always makes it worse, thats its 100% track record. Where in the Declaration of Independence, the Constitution, or the Bill of Rights does it guarantee the people health care, free or not. Its my understanding that those documents only guarantee the people the right to pursue healthcare if they so desire, not be forced to. If the government quits regulating healthcare, as well as all industries, the laws of supply and demand would work and keep the prices down to affordable amounts for those who want it, for no matter what the propaganders declare, not everyone wants it, and as an American I was taught that I was free to make my own choice to purchase or not. What has this country come to?

    11. Dee Miller says:

      When our country is broke just where and who will pay for this???????I am not for the new Health care bill. There are items in it that do not apply to Health. Our country gives to all the international countries lets just keep some of that money home to help Americans and stop giving giving and giving. How many years have we helped Africa???????Still same ole problem and worse aid cases. Keep our money here in America. People should do community work if they recieve government help. Unless body is in bad shape and can not work. No free anything if tested the people are testing out with drugs and alcoholics. We are just helping them the wrong way.

    12. robert jones golden says:

      TOO CHRIS AUSTIN TX.

      YA DROP MEDICAID, THEN DISABLED PEOPLE LIKE ME WILL BE ROBBING PEOPLE LIKE YOU TO SURVIVE,GOOD LUCK NUMBSKULL

      BOB

      KINGMAN AZ.

    13. robert jones golden says:

      TOO WP KOCH:SOUNDS LIKE A WINNER, SEND THAT TO OBUMMER

      BOB JONES

      KINGMAN AZ

    14. PippN, Severna Park says:

      No tort reform equals no cost cuts from insurance companies, drug manufacturers, doctors and surgeons.

      Here is what the Wicked Witch of the West slid into Abominalcare for bags full of cash from the Trial Lawyers Association. Pelosi received more lobbyist money than all other Congressional members up to the election and completely refused to talk to Republicans for 4 years. Take note of the last sentence.

      Section 2531, entitled “Medical Liability Alternatives,” establishes an incentive program for states to adopt and implement alternatives to medical liability litigation. [But]…… a state is not eligible for the incentive payments if that state puts a law on the books that limits attorneys’ fees or imposes caps on damages.

      Nice, huh?

    15. FRANK CAPOBIANCO MD says:

      I AM ANTICIPATING A 20% REDUCTION IN WHAT MEDICARE PAYS ME FOR PROVIDING PSYCHIATRIC SERVICES STARTING IN DECEMBER OF 2010. THIS 20% IS ON TOP OF THE ALREADY SIGNIFICANT REDUCTION THAT MEDICARE INSISTS UPON FOR HAVING THE PRIVALEGE OF PARTICIPATING IN THEIR PROGRAM. YOU CAN BET THAT I WILL DROP OUT OF THE PROGRAM IF THAT HAPPENS.

    16. Thomas Kolter, FL says:

      For reference at the ,just over Medicaid eligibility, 3% of your income for premiums as the max amount and out-of-pocket percentage covered by the government would be 94%. So will use these numbers for those under that for reference.

      In example if a person made $14,000 and would have been under Medicaid they would be hit no more than $420 a year or $25 a month. And if they had medical care costing $1000 would pay on their end $60. If someone was homeless obviously it would be a whole different ball game with very low incomes or $0 income.

      I have a question for critics is that so much to ask of a poor person to pay for health care I earn around that amount in fact less, and I could pay $25 a month and 6% of my out-of-pocket costs in most cases. I think its good for poor people if they work and are productive to have some responibility for our health care. I'll take the Medicaid expansion since its in my best interest and will have no choice being disabled and have medical issues. But I'd rather pay something.

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