SID SALTER: Medicaid remains ticking time bomb for new officials

By Sid Salter

STARKVILLE – While most of the attention and all of the yard signs are concentrated on who the new slate of statewide and legislative officials will be after the 2011 elections, veteran public officials know that the ticking time bomb that constantly requires attention once those officials are elected is the state’s Medicaid program.
Medicaid in Mississippi is nearly a $5 billion annual proposition using both federal and state dollars. It is also the most heavily-subsidized Medicaid program in the nation. In the fiscal year that ended June 30, for every $1 the state spent on medical care for the poor, the federal government spent $5.61. In the current fiscal year that began July 1, the ratio drops to $3 in federal funds for every $1 spent in state dollars.
But even at that ratio, the state’s portion of Medicaid is a huge expense. The total state portion in the last fiscal year was $619 million. Looking ahead under the Obama health care reforms, Gov. Haley Barbour commissioned an economic impact study that forecasts that the legislation would require state lawmakers to come up with an additional $1.7 billion over the next decade.
That’s because in 2014 the Obama reforms will require states to provide Medicaid to all those who earn up to 133 percent of the federal poverty level, currently at $19,564 for a family of two. Other than some children, the state currently does not provide Medicaid for people with that level of income.
Presently, an adult in a two-person family can’t earn more than $6,472 per year and still qualify for Medicaid. Childless adults don’t qualify regardless of income. Even with those eligibility requirements that are among the toughest in the nation, the recession has driven up Medicaid eligibility in the state to the point that 22 percent of the state’s 2.9 million citizens are eligible.
For the entire eight years of his term in office, Barbour has worn the political black hat on Medicaid while battling to control costs and cut spending on the state’s massive Medicaid program. Chief among Barbour’s supposed sins on Medicaid was his controversial requirement of face-to-face reauthorization of eligibility. Barbour has also fought consistently for additional “flexibility” for the program for state governments.
There are few who look at Barbour’s record on Medicaid dispassionately. Supporters say he’s succeeded in making common sense policies to control escalating drug prices and to establish eligibility through the face-to-face reauthorization interviews. Critics blast Barbour for cutting spending by the Medicaid program in the poorest state in the union.
The new governor, lieutenant governor, speaker of the House, and the new Mississippi Legislature have the state’s Medicaid program awaiting them as soon as they lower their right hands after taking their new oaths of office. While the rhetoric flies, the so-called “repeal and replace” effort against the Obama care reforms is easier said than done and can’t be accomplished until 2013 at the earliest.
Unseating an incumbent president or getting to the point of having 67 votes in the Senate to override a certain veto by President Obama if he’s re-elected are both tall political hills to climb. The bottom line is that for at least two years and perhaps six, Mississippi state government is going to have to adjust to a different Medicaid paradigm and the most predictable part of that is that in the long term, increased eligibility will mean increased costs.
The Obama reforms mean that Mississippi will see sharp growth in its Medicaid rolls in 2014. Some estimates, including Barbour’s, conclude that the state’s Medicaid program could expand to cover two-thirds of the state’s population. The feds will cover the costs of that expansion for the first three years, but in 2020, the federal share drops to 90 percent.
New state leaders and a new Legislature will face an old problem. How do you control the growth and the costs of healthcare for the poor in the poorest state in the union?
Sid Salter is a syndicated columnist. Contact him at (662) 325-2506 or ssalter@library.msstate.edu.