Medicaid expansion – what Big Media is concealing

There are many good reasons for refusing to take the Obamacare bait.

Big Media has been incessantly trumpeting that the benefits of a state expanding Medicaid are so great and completely without downside that only reprobate Republicans could oppose it. Among the benefits touted are free money from Washington and better health care for the poor.

One reason the clamor has been so great is the silence of the mainstream press – Big Media – about why a state may wisely choose to decline. Another is that the  Obamacare legislation was crafted with politically motivated incentives and penalties designed to bolster support.

Below we will list some of the good reasons why the expansion of Medicaid is like the spider’s entreaties to visit his humble abode. 

The best reason for declining Medicaid expansion is that Medicaid is so bad at delivering good outcomes that the poor would be better served by continuing to go to emergency rooms or clinics accepting the uninsured. The press has tried to steer the debate away from good healthcare to insurance. But good healthcare is the goal, insurance merely the primary, but not the only means.

Hospitals are primarily on board with expansion because the Obamacare law would unnecessarily and by political design reduce their existing subsidies if there is no state-run exchange. Shouldn’t the states let the horrible provisions of Obamacare serve as motivation to change or scrap the law, rather than imitate it with more bad legislation?

The Feds promise to pay at least 90% of the increased costs for years on end. But given the parlous state of Federal finances Congress likely will have to reduce this entitlement, leaving the states to pay the difference. Even 10% of a very big and rapidly inflating expenditure is still a lot of money.

State refusal to expand Medicaid would free many people from the penalties of the individual mandate. If there is no state-run exchange, the Obamacare subsidies to private insurance would not exist and thus people facing health insurance costs greater than 8% of their income would be off the hook.

Businesses with 50 or more employees also would be off the hook and not liable for the $2,000 annual fine if health insurance is not provided. This seems to us a rather big deal, since employers could continue with existing health insurance benefits not subject to the Secretary of HSS’s bloated and controversial requirements.

These last two points would increase personal income as well as stanch the loss of full-time jobs other states will experience. The state may lose some revenue for a time, but its citizens would benefit. It is estimated that if 25 states refuse expansion, federal spending would be reduced by $0.6 trillion by 2023. It’s the patriotic thing to do.

If the law is changed in a positive way (a development assisted by refusing expansion,)  states could reconsider and expand their Medicaid programs later. What about the deadline for expansion proposals the mainstream press has reported? A reading of the law reveals that there is no deadline. This has been affirmed by Gary Cohen, the D.C. bureaucrat in charge of certifying state exchanges.

And finally who will get blamed when the Obamacare trainwreck finally happens? It will be the states that have decided to run their own exchanges.

Thanks to Peter Suderman of and Michael Cannon of the Cato Institute   for their reporting.Troglo



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