Wednesday, October 15, 2014
OKLAHOMA CITY - Governor Mary Fallin today reiterated her opposition to the Medicaid expansion in Obamacare after the Oklahoma Health Care Authority reported that it would need an additional $164 million to maintain Medicaid at its current level. Read more here.
“There are currently 818,000 Oklahomans on Medicaid,” said Fallin. “These are low-income Oklahomans, children, pregnant women, the elderly and people with disabilities. Because of the sky-rocketing cost of medical care, and the failure of Obamacare to bend that cost curve, states are increasingly struggling just to keep these individuals covered.
“The Oklahoma Health Care Authority estimates we need $164 million more just to cover our current obligations. I am committed to finding the resources we need to ensure that none of our current Medicaid recipients lose their coverage.
“In light of that need, the idea that we should dramatically expand Medicaid – as called for under Obamacare – is downright irresponsible. Washington has tried to entice Oklahoma and other states into a federal health care scheme that threatens to create the kind of budget crisis in our states that already exists on a federal level.
“Medicaid costs rise every year for Oklahomans. We already struggle to cover those costs and provide health insurance to the truly needy. Accepting a huge expansion of that program through Obamacare would be a billion dollar expense that would truly create a fiscal catastrophe. Not only would that threaten the viability of the current Medicaid program, it would jeopardize our ability to pay for other priorities like public education.
"Luckily, most Oklahomans understand why the state is not and should not pursue an Obamacare expansion. Our entire federal congressional delegation, House Speaker Jeff Hickman, Senate President Pro Tem Brian Bingman and the large majority of our state legislators have all joined me taking a stand against Obamacare, and I commend them for doing so."
In Case You Missed It
Expanding Medicaid threatens Oklahoma's bright future
By SEN. TOM COBURN & JONATHAN SMALL | Posted: Sunday, October 6, 2013 12:00 am
Across the country, state policymakers are debating whether or not to implement the Affordable Care Act's Medicaid expansion. So far, Oklahoma's leaders have declined to expand Medicaid — a reasoned decision that we applaud.
However, proponents of Medicaid expansion in our state, such as hospitals and some businesses, argue the law includes "money on the table" for states, since under "Obamacare" the federal government says it would pay for 90 percent of the expansion population in perpetuity.
But a future Congress is not bound by current law; it can simply rewrite it. Congress has a history of overpromising funding for states, so it would be folly for states to build their budgets around a promise Congress is unlikely to keep.
Consider a policy analogy from education. In 1975, when Congress passed the Individuals with Disabilities Education Act, Uncle Sam promised to pay 40 percent of each state's costs.
However, over the last two decades the federal government has paid less than half of what it originally promised. For the past decade, the shortfall has cost states nearly $175 billion. In Washington, it's an "open secret" that Congress has to reduce Medicaid outlays. That's why virtually every major bipartisan plan includes recommendations to reduce the federal dollars given to states for Medicaid.
It's not like the federal government is exactly flush with cash. According to the Government Accountability Office, total governmental unfunded liabilities tally more than $88 trillion. Even scarier, under generally accepted accounting principles, that number is closer to $124 trillion. In this environment, a clear-eyed view of the future suggests Congresses will seek ways to curb Medicaid spending. In addition to Congress writing a check that will bounce, the federal government's promise to pay 90 cents of every dollar for a Medicaid expansion obscures real costs to states. This is like Uncle Sam fleecing the states by offering to give them a new product they realistically cannot afford, by offering the first few months for free.
The fact is Oklahomans already struggle to pay for the current Medicaid program in our state. According to data from the Oklahoma Health Care Authority, roughly one in four Oklahomans were enrolled in the program last year. When one out of four people are enrolled in Medicaid, state taxes have to be increased on the three remaining individuals outside the program, just to pay for it.
Medicaid already pays for two-thirds of births in our state, as well as two-thirds of the occupied beds in long-term care facilities (when measured by length of stay). The program's budget is already bigger than state spending on all schools and universities combined. The program costs and number of enrollees in Medicaid have grown each year since 1995, and the speed of the program's growth has exceeded the growth in our state's population, even through periods of economic growth.
Based on last year's enrollment data, expanding the program could result in nearly one in three Oklahomans on Medicaid. Jagadeesh Gokhale, a member of the Social Security Advisory Board, estimates that could cost Oklahoma taxpayers $1.6 billion the first ten years. By 2023, he projects Oklahoma's bill for Medicaid would come in at $6.5 billion annually — a sum equal to the entire state appropriated budget in Fiscal Year 2012!
One important reason to not expand Medicaid in our state is that doing so could threaten access to health care for the people who depend on the program. While SoonerCare has above-average access to providers for patients on the program, nationally, about 40 percent of primary care physicians and about 65 percent of specialists do not even accept Medicaid patients. What good is to offer Oklahomans health coverage if, in reality, they cannot access care in a timely manner?
For too many Medicaid patients in other states, their care is routinely delayed and denied.
Before "Obamacare," some states already tried expanding Medicaid and nearly bankrupted themselves in the process. The state of Tennessee had an especially painful experience with its state Medicaid program, TennCare. The program nearly bankrupt the state and thousands of individuals were eventually cut from the rolls.
States like Maine and Arizona experienced cost overruns more than double their estimates, resulting in arbitrary program caps that displaced needy patients. Meanwhile, states like California and Illinois had to implement huge tax increases and slash provider reimbursements, leaving their states far less competitive and many patients struggling to see a doctor.
The lessons of history and the hard numbers are clear: It is not fiscally responsible or wise to expand a strained entitlement program and rely on federal funding that is unlikely.
While it has been tempting for some consultants and lawmakers to try and dress up Medicaid expansion as "program redesign," it is simply not in our state's long-term interest to expand Medicaid, whether that's under the guise of additional federal funding or creative program designs. Given the economic facts, any expansion of Medicaid under the Affordable Care Act would be a step in the wrong direction.
Rather than expand Medicaid, policymakers should work to mend Medicaid by pursuing reforms to better manage and coordinate care and promote medical price transparency. This can help create an environment in which the number of our fellow Oklahomans enrolled in Medicaid can be reduced, not increased.
Tom Coburn, a Republican, is a physician and the junior senator from Oklahoma. Jonathan Small, a certified public accountant, is fiscal policy director of the Oklahoma Council of Public Affairs.
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