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  • GUEST POST: History of Medicaid Expansion in Maine Foreshadows Failure

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    The states play an important role in protecting citizens against this flawed federal health care law–from challenging the health care law before the Supreme Court, to resisting efforts to establish Obamacare exchanges or expand a failing Medicaid program, to offering alternative proposals that will ensure citizens are not left abandoned when the federal law collapses.

    Today, Joel Allumbaugh – Director of the Center for Health Reform Initiatives at the Maine Heritage Policy Center – updates Foundry readers on developments in Maine.

    States throughout the country are struggling with the decision to expand Medicaid under Obamacare—and Maine is no exception. In Maine, however, we have the advantage of our own history to guide us.

    We have all heard the arguments for expansion. There is a contingent of people falling through the cracks. They don’t qualify for Medicaid today but also cannot afford private health insurance. They avoid the health care system due to lack of financial resources, fail to get preventive and maintenance care, and ultimately show up in our emergency rooms—often at the expense of taxpayers.

    We are paying for these people regardless, why not expand Medicaid and pay less by helping these populations get the care they need in less expensive settings? Not only will the uninsured rate drop but so will charity care provided by hospitals. Medicaid expansion is a no brainer, right?

    The problem with this argument is that Maine’s own experience proved otherwise. The promises of reduced uninsured rates and lower charity care simply did not come to fruition.

    In fact, Maine’s own Department of Health and Human Services Commissioner pointed out in testimony to the Florida legislature in February of this year that charity care and bad debt at Maine hospitals grew over 220 percent from $67 million to $215 million between 2002 and 2011 after Maine expanded Medicaid for childless adults in 2002.

    The Medicaid expansion under Obamacare also applies to able-bodied childless adults up to 138 percent of the federal poverty level (FPL) versus 100 percent under Maine’s 2002 expansion. We also know that this is an expensive population, costing more than twice what it would cost to insure parents in the same income bracket.

    As for the argument that expansion will reduce the uninsured, during the same time frame from 2002–2011, the uninsured rate in Maine remained stagnant at around 12 percent. Medicaid enrollment did increase from 16 percent to 23 percent but this was largely due to a shift from those with private coverage to government coverage. Private individual coverage rates over this time fell from 8 percent to 6 percent and private employer coverage rates dropped from 66 percent to 61 percent. If this pattern repeats, further expansion under Obamacare will shift more people on private insurance to Medicaid.

    The promises made to justify expansion not only did not come to fruition, we also failed to keep the promises we made to the population targeted by the expansion. Commissioner Mayhew pointed out in her testimony that 10,749 childless adults are enrolled in MaineCare as of 2011, while 24,331 sit on a waiting list for services.

    Sadly, they are not alone. There are 3,100 disabled and elderly also waiting for services while nearly 11,000 able-bodied residents currently receive benefits. Given the national debt and deficit spending problems, can we depend on stable funding or will these waiting lists eventually grow even larger?

    With such a clear lesson learned in Maine you may ask why Maine is considering expansion today. The answer is all about politics. Democrats regained control in the legislature in the 2012 midterm elections. Empowered by their return to power and convinced their success was reflective of public disapproval of Governor Paul LePage’s (R) policies, they focused on implementing Obamacare and expanding Medicaid.

    The democrats introduced LD 1066, An Act to Increase Access to Health Coverage and Qualify Maine for Federal Funding, a short bill with less than two pages of text that simply expands Medicaid consistent with Obamacare. To gain additional leverage, Democrats linked LD 1066 to another of the Governor’s campaign promises: to pay Maine’s $181 million share of $484 million in debt owed to Maine hospitals.

    LePage has insisted the two issues remain separate and signed a veto within minutes of the Democrats passing their bill on a party-line vote.

    It is ironic that the Democrats in the Maine legislature attempted to link repayment of debt created by Maine’s inability to meet its current obligations under Medicaid to an expansion of Medicaid.

    Expanding Medicaid is neither a win for Maine nor for our nation. This amounts to shouldering our children and future generations with obligations for promises we cannot keep, based on assumptions that have already proven false.

    Joel Allumbaugh is Director of the Center for Health Reform Initiatives at the Maine Heritage Policy Center.

    Posted in Obamacare [slideshow_deploy]

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