Medicaid expansion is still the wrong choice for Texas

Medicaid expansion is still the wrong choice for Texas

Published on TribTalk on November 1, 2016.

By John Colyandro and Tom Aldred

recent TribTalk column by health plan CEO Ken Janda alleged that Texas “squanders” $40 billion per year by refusing to expand Medicaid to able-bodied adults. The reality is much different than this. In truth, Texas invests in its safety net system to provide an array services for the indigent — while states that have expanded Medicaid are facing budget shortfalls and tax hikes. All of which makes expansion the wrong choice for Texas.

Arguments for Medicaid expansion under the Affordable Care Act assume that Medicaid coverage is synonymous with access to care. Unlike many other states, however, Texas invests heavily in its health care safety net system.

Texas has 142 hospital districts and 162 public health care facilities that provide care for those who do not qualify for Medicaid. Hospital districts and county indigent programs administer programs that provide basic health services such as physician services, examinations, and immunizations. Through the state’s 1115 Medicaid waiver, regional health care partnerships receive funding to implement programs to serve both the indigent and Medicaid recipients. There are 1,485 active projects, aimed at increasing health care access and outcomes for these populations.

Proponents of Medicaid expansion fail to acknowledge these facts. They also overlook the fact that more than half of the state-run Affordable Care Act exchanges have collapsed due to financial insolvency and that several of the nation’s largest health insurers have withdrawn from the exchanges altogether. Indeed, Texas’ largest insurer has proposed premium increases of more than 50 percent, saying that Obamacare “is not a financially stable business model.” None of these things improve access to care.

These problems are exacerbated not only by growing caseloads but also by a much higher cost per enrollee than initially estimated. The Centers for Medicare and Medicaid Services’ own data show that the average cost for the expansion population was about 49 percent higher than originally projected. This has led to budget crises in several states: Kentucky raised taxes to address a $400 million shortfall; Illinois’ 2014 legislative session ended in an unaddressed $3 billion budget shortfall; Washington state experienced a shortfall of $4 billion; and New Mexico faces the prospect of finding an additional $100 million to $150 million per year to cover its share of Medicaid expansion.

At the same time, the promise of federal matching funds that have made expansion apparently irresistible to many other states is a hollow one: The federal government cannot afford the future cost of its entitlement programs without adding further to the nation’s $20 trillion of debt. Every advocate of expansion is an advocate for increasing the national debt because expansion is not paid for in any meaningful sense and will only add to the nation’s crushing debt.

Yet cost is not the only reason to reject expansion. Numerous studies show that, even after controlling for clinical and socioeconomic factors, Medicaid enrollees experience worse health outcomes for certain diseases and procedures, including higher mortality rates, than individuals with private insurance or no health care coverage at all.

Medicaid and the Affordable Care Act are already failing. Texas should retain its focus on fostering an economic environment that creates a path to self-sufficiency. That, together with making commercial and portable health care options available, is preferable to expanding a program that makes the false promise of “access to care.”