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Expanding Medicaid Eligibility Better Of Two Bad Options

When it comes to Obamacare, I could not agree more with the following statement:

To fault the Administration, the reform of the nation’s health care should hardly have been the focus of policy innovation in the face of chronic unemployment where the nominal rate continues to hover at 8 percent.  The more so given that the legislation that passed has more growth retarding features than any single previous piece of federal legislation ever.  The Affordable Care Act might as well have been called the “Stop Economic Growth Act.” 

There is no greater threat to job creation than Obamacare.  It’s already had devastating effects, and will continue to have such effect until it is repealed.

Clearly, I’m no fan of the law.  And you know who else agrees with me?  Governor John Kasich.

Kasich signing a petition for the Healthcare Freedom Amendment

So it comes as a surprise to me the amount of intense criticism, not from liberal Democrats, but from Ohio’s conservatives, on the Governor’s budget proposal, one portion of which would expand Medicaid.  It’s as if some people have forgotten what happened this past November.

We lost.  There’s no changing that.  And I can’t imagine President Obama repealing Obamacare.  Just call it a hunch.  So we’re stuck with this devastating law.

That’s not something that Governor Kasich can change.  But what he can do is make sure the law hurts Ohioans as little as possible.  His reforms to the Medicaid system have already shown cost savings of nearly $2 billion over the last biennium:


And Kasich’s decision to expand Medicaid eligibility to 138% of the poverty threshold is another step to protect Ohioans.  Given the increased costs (initially all federal), that seems counterintuitive, but the facts don’t lie.

Without expanding Medicaid, the costs to individuals with private health insurance will go up—something that both liberals and conservatives agree on.

Without expanding Medicaid and accepting federal funding, the cost of uncompensated care to hospitals will lead premiums to rise as much as 1.7 percent, according to Americans For Prosperity.

That might not sound like all that much until you crunch the numbers.

The average family premium is more than $14,000 per year. If there were only 500,000 family health plans in Ohio (likely more than that with a state population of over 11 million) premiums would rise $121.8 million more per year for private sector health insurance paid for by workers and employers.

The Ohio Chamber of Commerce cites the increase in health insurance premium costs as its reason for backing Kasich’s proposed Medicaid expansion.

Due to the phase out of disproportionate hospital share funding (the DSH subsidy) under Obamacare, hospitals will bear an increased burden for uncompensated care of those uninsured.  In 2012, Ohio hospitals relied on the DSH subsidy to the tune of $550 million.  With the expansion of Medicaid, having more people insured, Ohio is able to make up a large portion of that funding loss.

And the hospitals least likely to afford the DSH subsidy phase out are those in rural areas, particularly in Southeast Ohio.  Without the expansion of Medicaid to help compensate for that lost funding, these rural hospitals will face a disproportionate burden from their urban counterparts, and may possibly face job losses or even closure.  That puts more Ohioans further from potentially life-saving emergency care.

As to the bottom line, expanding Medicaid actually has a positive budget impact this biennium, reducing the state share of Medicaid funding by $91 million over the next two years.  Yes, the federal government won’t be picking up 100% of the tab forever, and we’ll eventually be responsible for 10% of the expansion costs, but that’s something we can plan for.  And it won’t ever be more than 10%, even if our divine-ruler of a President decides to federally increase the state share.  Kasich’s budget plan would automatically repeal the Medicaid expansion if Washington decides to change the deal.  So Ohioans won’t be on the hook.

Others will disagree, but we believe Kasich’s decision on whether to expand or not to expand was the better of two crappy options.  And it’s important to realize the government takeover of our nation’s entire healthcare system wasn’t Kasich’s idea.

Obamacare was forced on us by Obama, Reid and Pelosi.  Obamacare was forced on us by the Supreme Court.  Saying no to expansion does not stop Obamacare and expansion is not a referendum or approval of Obamacare.  And there’s a building consensus among conservative leaders that backs Kasich’s decision.

Conservative stalwarts across the country have made the same decision, including Arizona Governor Jan Brewer, New Mexico Governor Susana Martinez, Nevada Govenor Brian Sandoval, and Michigan Governor Rick Snyder—not because it was a slam-dunk choice, but because, as a senior aide to Governor Brewer said, “politically, the dynamic may be shifting.”  It’s not as cut-and-dry as we would like.

I’ll openly admit this isn’t a perfect system.  But we’re stuck dealing with this President, and his anti-growth, job-killing policies for the next four years.  The best way to mitigate the damage caused by Obama is to do what’s best for Ohioans.  That’s what Kasich’s decision to expand Medicaid is all about.

And as much as I’d love to stand on conservative ideological purity, I’m not willing to do it at the expense of my fellow Buckeyes.

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Third Base Politics is an Ohio-centric conservative blog that has been featured at Hot Air, National Review, Washington Post, Los Angeles Times, Pittsburgh Tribune-Review, and others.


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