In his piece, “Obamacare created a Medicaid time bomb,” Michael Tanner of the Cato Institute exposes the grim reality underlying Obamacare’s enrollment numbers. Of the 1.6 million Americans who have enrolled so far, 1.46 million of them actually signed up for Medicaid as a result of Obamacare’s Medicaid expansion or due to individuals who were already eligible, but not enrolled. Obamacare was suppose to mean affordable health care through a private insurer, not sub par free health care government employees wouldn’t touch with a ten foot pole.
If Medicaid enrollments continue at this rate, state and federal budgets will come under serious financial pressure. Tanner points out that Medicaid is already the third largest federal program behind Social Security and Medicare and the three together make up 48% of government spending. The Congressional Budget Office projects that federal spending on Medicaid will double in size by 2023 to $554 billion.
Medicaid is a significant expenditure on the state side as well, oftentimes crowding out other important priorities such as education. Ohio is a perfect example. A policy brief from Opportunity Ohio and the Foundation for Government Accountability tells us that between 2000 and 2011 spending on Medicaid in Ohio grew $7.5 billion. Beginning in 2009, Medicaid spending in Ohio started to outpace education spending and the gap continues to widen. In 2011, Ohio spent nearly 24% of state expenditures on Medicaid while spending approximately 20% of state funds on education.
Now that Governor Kasich, Senate President Keith Faber and House Speaker Bill Batchelder have committed Ohioan’s to Obamacare-directed Medicaid expansion, education spending in the state will come under growing pressure. Under Kasich’s expansion proposal Medicaid spending increases to $23.6 billion by fiscal year 2015, but this number is based on the Governor’s lowball enrollment projections put forth to make expansion politically salable. Three highly respected sources show expansion eligibility rates to actually be between 684,000 and 848,000, over three times higher than Kasich’s 275,000 estimate. Care to wager whether these more realistic enrollment figures will have a significant impact on state Medicaid expenditures?
The states that will be hit hardest by the rapid rise in Medicaid enrollments will be the states whose governors and state assemblies were gullible enough to buy the federal government’s phony offer: 100% funding of Medicaid expansion for three years declining to 90% by 2020. Tanner notes that the Obama administration has already considered lowering the federal reimbursement rate for Medicaid expansion and the National Journal recently reported that U.S. House Republicans have begun to discuss lowering the reimbursement rate as well.
Where does that leave Ohio? We will know in a few months. The Kasich administration announced Medicaid expansion enrollment began on December 9th. Concerned Ohioans should watch the enrollment number closely over the course of the next year as the number will have a measurable effect on everyone’s health care.
28% of Ohio doctors already refuse to see Medicaid patients. Patients who cannot find care will end up in the ER exacerbating waiting times and leading to cost shifting to insured patients since Medicaid reimburses providers at such low rates.
So expect longer lines, higher premiums and lower quality care from a health care system under increasing pressure, and all for naught, as an important study of a Medicaid expansion in Oregon showed no “significant improvement in measured physical health outcomes” among participants.
Governor John Kasich, the “budget hawk” that cares so much for the less fortunate, has led our state down a precarious fiscal path and put our health care system in jeopardy, all in the name of Obamacare, re-election and a long shot at the presidency. We all have to meet our maker some day, but Kasich’s legacy will be particularly difficult to explain.