After compelling arguments on both sides of this issue, along with some very heated debate, the decision was made to neither accept nor expand Medicaid. The majority of the House believes expanding Medicaid at this time is not a responsible use of our taxpayer dollars.
Those in favor of Medicaid expansion say that the federal government will pay for the entire expansion for the first three years. And, yes, it is true that they promised to do that, but with almost $17 trillion in national debt, many believe they may not be able to meet this obligation. Even if the federal government is able to totally fund Medicaid expansion for three years, the addition of the proposed approximately 300,000 new Missouri recipients on the rolls will cause our state Medicaid expenses to skyrocket. At the end of the three-year time period when the federal Medicaid funding will begin to diminish, the states will be required to pick up more of the costs. Then the question will be, “Where will the money come from?” As a state, we will most likely have to raise taxes substantially and make drastic cuts in such programs as public education (K-12 and higher) and infrastructure to fund Medicaid.
Under the Supreme Court’s decision on the Affordable Care Act, states may choose to expand their Medicaid rolls to include individuals below 138% of the federal poverty level. As previously mentioned, the federal government would pay 100% of the cost for the first three years for new enrollees before backing off on payments. The feds have structured the Medicaid expansion to be attractive to the states, appearing to increase health coverage at little or no cost to the states. However, after the three promised years, the expansion could become very, very expensive to the states.
Currently, the Obama Administration is proposing to reduce the federal-state matching rate, but many state governments are already struggling with Medicaid spending as it is. Today there are 60 million Americans (approx. 1 in every 5) covered under Medicaid, at an annual cost of $450 billion. Just the size and the complexity of the current program are mind-boggling. If the proposed expansion becomes a reality, it could increase our national Medicaid expenditure by another $220 billion per year on top of what is already being spent. Medicaid is Missouri’s largest budgeted item.
Various analysts believe that the Medicaid program is broken and that it is time to implement reforms to the system, reforms that include dealing with dishonesty. A big problem with Medicaid is fraud. Official federal estimates show that at least 10% of current Medicaid payments are fraudulent. Many prosecutors believe this figure to be closer to 30% for fraudulent Medicaid payments, and they aren’t alone. Those on both sides of the aisle—at state as well as federal level—agree that combating Medicaid fraud is a priority in order to continue to provide needed services while keeping down costs.
Instead of adding millions of individuals to the already bulging Medicaid program, maybe Washington should be looking at ways to make the necessary changes and reforms now—including aggressively dealing with fraud—and giving states more control over spending, benefits, and federal mandates.