SID SALTER: Medicaid expansion or not, health costs will be paid

By Sid Salter

While the battle continues between state Republicans and other fiscal conservatives intent on focusing on the long-terms costs of Medicaid expansion under the Affordable Care Act and Democrats, health care advocates and state hospitals intent on focusing on the short-term benefits, the fact remains that one way or another, the costs of providing health care for the poor, the blind, the aged and the disabled will be paid by the taxpayers one way or another.
A Mississippi Institutions of Higher Learning economic brief by state economist Bob Neal last year made the nuts-and-bolts of the Medicaid expansion question clear: “The results in each scenario indicate that Medicaid expansion will generate additional state Medicaid costs in years 2017-2025. From 2014-2020, cumulative state costs of Medicaid expansion, minus additions to state General Fund revenue, are projected to range from $109 million to $98 million. From 2014-2025, total state costs of Medicaid expansion, minus additions to state General Fund revenue, are projected to range from $556 million to $497 million.
“Increased access to health care could enhance the overall health of Mississippi’s residents. In the long-term, a healthier workforce should result in a more productive workforce, leading to a healthier, more robust economy. Estimating these possible long-term economic improvements is beyond the scope of this study. In the long run (30 to 40 years) the benefits of Medicaid expansion might outweigh the costs. Paying for it in the years ahead might be a challenge,” Neal concluded.
That assessment matches one drawn in a national study by the Kaiser Commission on Medicaid and the Uninsured three months ago which held, in part: “For opponents of Medicaid expansion in Mississippi, which to date includes state Republican heavyweights like Gov. Phil Bryant, Lt. Gov. Tate Reeves and House Speaker Philip Gunn, the report supports the contention the Medicaid expansion can’t be accomplished without increased costs to state government.
“States are deciding whether to expand the Medicaid program, and they clearly will be balancing improvements in coverage against new costs for states,” said Diane Rowland, executive director of the Kaiser Commission on Medicaid and the Uninsured upon release of the study. “While some states will see net savings, others will need to weigh the trade-offs between small increases in state spending in return for large gains in coverage supported by mostly federal dollars.”
The report clearly names Mississippi – given the large number of uninsured and Medicaid eligible under the ACA – as one of the states that will see such cost hikes. So let’s focus the debate on that point – the Mississippi Legislature faces a choice between raising public health care costs for Mississippi taxpayers and expanding health care coverage to the state’s poor and working poor.
Complicating that debate is the fact that as the poorest state in the union, Mississippi faces the lingering and compounding problem of high rates of uncompensated care – much of it delivered in the most expensive venue possible in hospital emergency rooms.
The Kaiser report points out that if uncompensated care costs are considered, increased costs “even in states with the highest level of increased Medicaid costs from the expansion, new state spending relative to general fund expenditures is approximately 1 percent or less.” That contention is one that Mississippi hospitals and Medicaid expansion proponents emphasize.
Opponents point to possible future federal policy shifts in calculating the state’s share of Medicaid expenditures after expansion as the greatest danger in expanding Mississippi’s Medicaid program. In other words, Medicaid expansion sounds good under the current rules – but what happens if the rules change in the future?
Unavoidable, however, is the conclusion that whether through Medicaid or through uncompensated care, the taxpayers will still face the ultimate burden of paying for health care for the poor.
SID SALTER is a syndicated columnist. Contact him at (601) 507-8004 or sidsalter@sidsalter.com.