The Affordable Health Care Act was upheld by the Supreme Court yesterday with each state having the option of whether to expand Medicaid or not. Many states’ Governors, including the gov. in my state, has denounced the decision and said they are each considering NOT accepting Medicaid expansion – the expansion is a requirement for the 100% financial pick up of Affordable Care Act (ACA) costs the first few years and then 90% after that. They say they cannot afford the expansion of Medicaid and it’s expansion……….nice try. This is a lot of smoke and mirrors as they pander to the most financially conservative of their state residents.
I’m not making a political statement at all so please do not mistake this for one. This is purely financial and state government knowledge. Medicaid is paid through matching funds between the state and the federal government. The state portion is determined based on the economy of the state – how well the state is doing financially. My state is one of the more financially solvent states and has not suffered as much during the recession like many other states, mostly because of our oil production. Our state’s match is about 68/32 which means that for every Medicaid dollar spent in our state – the feds pay $.68 cents and our state pays $.32 cents. So, as an economically stable state we pay 1/3 of medicaid costs – the states who are worse off economically pay even less. Another thing to consider is that those who are not currently covered, remain ill longer and then one day the MUST go to the ER or clinic or some other medical facility and then the state will have to pick up 100% of the costs.
The ACA will expand mostly waivers and those waivers target mostly the elderly and disabled of the United States. Paid at 100%. These are the most costly eligibles there are…….Hmmm…. Really? The other thing about costs that are paid 100% by the feds (Child Day Care and SNAP – formerly Food Stamps are both 100% reimbursement) is that if our state decides not to take it then other states get even more, because that money is going to go somewhere. I remember when former California Governor Schwartzenegger went into office. He fussed and fumed about how the state was broke and how he was going to cut off the “free lunch” of Food Stamps. I remember thinking that he was either the stupidiest governor ever or he had the most stupid advisers ever. And then someone explained to him how Food Stamps really work and who they REALLY benefit (grocery store owners, farmers, and trucking companies) the most. Soon he was touting the program and seeking out any and everyone in California who would qualify in order to apply for the Food Stamp Benefit.
Since ACA will work much like Food Stamps and those who will benefit the MOST will be hospitals, clinics, private physician’s offices, and health therapy facilities – I would say all this strutting and posturing of governors is just that. Either they already know this is financially sound to help their states out of the mess they are already in, or one of their advisers will get to them and educated them PDQ. Then they will release a statement saying their hands are tied, and they are forced to take the money. And then they will.
In the end, it will help the elderly and disabled the most and they ARE the most costly folks in the Medicaid system. So whatever your feelings are about the Affordable Care Act, it is coming and we should prepare for the inevitable.
You can find the NY Times article here: http://www.nytimes.com/2012/06/30/us/politics/some-states-reluctant-over-medicaid-expansion.html?pagewanted=1&_r=1&nl=todaysheadlines&emc=edit_th_20120630
