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Learn from failure: Idaho lawmakers must not expand Medicaid

Learn from failure: Idaho lawmakers must not expand Medicaid

Idaho Freedom Foundation staff
July 26, 2017

 Samantha Verdell | Idaho Freedom Foundation

The GOP continues its attempts to replace Obamacare, but the party’s inability to fulfill its promise to repeal the ACA has reopened arguments for Medicaid expansion. Idaho state legislators must not succumb to the rhetoric that increased coverage ensures improved health outcomes. Although the gap population of Idaho is a problem that deserves attention, long-term solutions will not be found in the expansion of a program that drains states financially dry and puts no efforts into addressing the root causes of disparate health outcomes.

Medicaid expenditures and enrollment are escalating at the state and federal levels, regardless of expansion. This leviathan threatens the sustainability of other government programs.

Since the 2013 opening of its market exchange, Idaho has seen a 24 percent increase in Medicaid enrollment. In 2007, Idaho spent $357 million on Medicaid; according to legislative budget documents, the state’s estimated share in 2018 will be $532 million. Putting more resources into Medicaid diverts finances away from services like education. For example, Oklahoma now budgets $5.1 billion on Medicaid but only $3.4 billion on K-12 education annually. Both Idaho and Oklahoma have experienced this growth of Medicaid without expanding program eligibility. The financial burden would only worsen under expansion, as evidenced by states such as Oregon, Colorado, Illinois, Arkansas, and Ohio.

Oregon expanded Medicaid eligibility under the ACA and now faces a $1.4 billion deficit largely due to the state’s unmanageable increase in Medicaid enrollment. Initial reports about expansion stated that 115,000 of Medicaid’s new recipients were ineligible. However, an Oregon legislative press release later reported that approximately only 32,000 recipients were unqualified beneficiaries. The latter, much lower estimate was used to calculate Oregon’s $165 million expenditure on ineligible Medicaid members. However, that state’s government waste on Medicaid is likely much higher. But, instead of rolling back expansion, in 2017 Oregon politicians raised taxes more than $600 million, which will further burden the privately-insured. Already unaffordable health insurance premiums will be subject to a 1.5 percent tax increase. Medicaid recipients, even those who are ineligible for state assistance, maintain their coverage at the expense of non-Medicaid Oregonians.

Idaho must not, and should not want to, jump on the expansion bandwagon that is nearly impossible to jump off. States like Oregon acknowledge the unsustainability of their huge welfare program, but they simply shift the burden to taxpayers and increase government instead of fixing systemic issues that lead to poverty and unaffordable healthcare.

California’s Medicaid expansion is one of the biggest examples of what not to do in healthcare. Since 2012, Medi-Cal has added 6 million individuals to its rolls, which brings its state Medicaid population to 14 million. To put this number in perspective, if Medi-Cal were a state it would be the fifth-largest state in the nation.

Proponents of Medicaid expansion tout the benefits of coverage and its effect of increasing one’s access to services. Quite the opposite has resulted in practice. In California, only 55 percent of primary care physicians will accept new Medi-Cal patients. Though the number of individuals on Medi-Cal has skyrocketed, the availability of medical personnel has plummeted. As a result, emergency room visits by Medicaid recipients in California has increased by 75 percent over the last five years.

The premise of pro-expansion sentiments is that there is a positive correlation between health insurance coverage and access to healthcare services, but Medicaid populations actually suffer under the ill-advised policy. The states that have expanded Medicaid eligibility under the ACA have experienced an average over-enrollment of 110 percent above projections. If Idaho were to expand Medicaid, the estimated 78,000 Idahoans currently in the coverage gap would have health insurance, but Idaho’s current system is not prepared to serve the influx of patients. According to the Idaho Department of Health and Human Services, there are 256 health professional shortage areas in the state. The current lack of medical personnel in Idaho would be exacerbated by Medicaid expansion because, as stated above, many physicians would refuse to accept new Medicaid patients. Gem State spending would increase to “provide” individuals’ access to coverage, but it would be wasted due to the inability of recipients to utilize medical services in a crowded, limited provider network.

As Idaho’s legislators debate the best course of action, it is imperative that facts are the basis of decisions. Idaho has evaded the clutches of Medicaid expansion long enough to witness the failures in states that chose to expand coverage, and Idaho should learn from their mistakes. Healthcare is important, health insurance coverage is important, Medicaid is important, and the gap population of Idaho is important. However, expansion is clearly not the solution to a complex issue. Becoming more reliant on the federal government, flooding the understaffed medical system, increasing costs for taxpayers, and taking funds from other necessary state programs would only serve to hurt Idahoans.

If legislators truly care about helping the uninsured, they should work on making healthcare more affordable and accessible. Opening the insurance market and allowing interstate sales would competitively reduce costs of coverage, giving Idahoans affordable options. In addition, encouraging charity care and other innovative health service delivery models like telemedicine would provide all Idahoans with access to medical care.

Samantha is an intern for the Idaho Freedom Foundation and a recent graduate of Vanderbilt University. 

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