NC governor considering expansion

July 17, 2014
by Ann Kane

States that have expanded Medicaid to include able-bodied adults have seen services to the neediest decline and debts increase.

The Foundation for Government Accountability released its “Who Is on the Obamacare Chopping Block?” report showing how Obamacare’s Medicaid expansion in 26 states and the District of Columbia has failed to help the most vulnerable.

The study reveals the real winners of Medicaid expansion are not the elderly, the disabled or even low-income kids, but childless adults.

From the report:

Unlike other forms of welfare, Medicaid has no work requirement, meaning states are being asked to expand eligibility for taxpayer-funded Medicaid to able-bodied, non-working adults. Research shows that expanding Medicaid to this new class of individuals discourages work, depresses earnings, reduces labor-force participation and hurts the economy.

Rather than fixing Medicaid for the truly needy, ObamaCare’s Medicaid expansion overloads the safety net with able-bodied adults and prioritizes them over the nation’s most vulnerable patients.

Since the North Carolina legislature in 2013 rejected Medicaid expansion in order to get the state’s largest entitlement program at $14 billion under control, the state has not become victim to an “immoral funding formula that prods states to attack the truly needy with cuts in services and gives preferential treatment to adults without any disabilities or dependent children.”

In fact, Obamacare creates a “perverse incentive” for states to adopt expansion says Jonathan Ingram, Director of Research for FGA, where the federal government will reimburse on average 57% for the very needy, but 90% (100% for first three years) for able-bodied adults.

The federal government offers the carrot of high reimbursement rates for non-working childless adults, but states that take on expansion pay the price of having to cut other areas of Medicaid.

Several states including Arizona, Oregon, Maine and Illinois expanded Medicaid, but ended up either eliminating the program for critically ill patients or going into insurmountable debt.

Recently, North Carolina Governor Pat McCrory suggested expanding Medicaid would be a possibility in the future. He discussed “crafting state-specific proposals for Medicaid expansion” with other governors and Health and Human Services director Sylvia Burwell at the National Governors Association conference.

“What we’re trying to figure out is how can we get more waivers to adapt to what North Carolina needs,” he said. “Can we do it in a strategic way instead of across the board, do a better definition — if we do expand it — and get more assurance of what our true costs will be three or four years down the road, regardless of who the governor will be?”

While visiting a Western Carolina health facility, Robin Cummings, the new state Medicaid director said, “I would agree with what the governor said. We need to get Medicaid itself stabilized. Expansion would have brought 500,000 to I’ve heard as high as 750,000 additional people into the system. I’ll tell you right now, I think that would have broken it.”

McCrory asks what the true costs will be down the road—he need only to read the FGA report to find the answers.