The driving policy issue for the 2019 legislative session has been whether or not the state government should expand the Medicaid program as provided for under the Affordable Care Act. After months of discussions, confusion and misinformation still circulate about the topic.
Extensive research reveals Medicaid expansion to be a costly band aid that does nothing to address the underlying problems of cost and access within our healthcare system.
Civitas is your one-stop resource for information on this harmful policy proposal. This resource page provides simple answers to some of the issue’s most pressing questions, along with the body of Civitas research on each topic.
What is Medicaid expansion?
The Affordable Care Act (ACA) mandated states to expand their Medicaid programs to cover anyone making up to 133 percent of the federal poverty line. The Supreme Court ruled that states had a choice in doing so, and North Carolina is one of 14 states that have yet to expand the joint federal-state program.
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Who would benefit from expansion?
North Carolina’s current Medicaid program covers one out of every five people in the state. This includes low-income children, pregnant women, parents, individuals with disabilities, and the elderly. Given that the neediest among us are already covered by Medicaid, expansion would simply extend services to able-bodied, working-age adults. Seventy-eight percent of the newly eligible population would have no dependent children.
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But I’ve heard Medicaid expansion is “free money” or “no cost to the state” – so why not just do it?
The federal government covers about 90 percent of Medicaid expansion and the state picks up the remaining 10 percent of the cost. The state imposing new taxes on healthcare providers to pay its share illustrates that there is a cost to the state.
Contrary to the false narrative being perpetuated by the governor and other expansion proponents, North Carolina taxes are not paying for expansion in other states. North Carolina already receives more money from the federal government than it pays in federal taxes. The new taxes in the Affordable Care Act were not sufficient to fund expansion and any new expansion only adds to the federal debt.
Additionally, many expansion states are facing cost overruns of their portion of expansion. If the federal government ever drops the expansion match rate from 90 percent, the state could be left with a giant budget hole. This is not out of the question, given that traditional Medicaid is reimbursed by the federal government at only a rate of 67 percent.
More information:
- Hold the line against Medicaid expansion
- Medicaid expansion and the mythical pot o’ gold.
- Your children and grandchildren are paying for Medicaid expansion
- Medicaid expansion: a budget-sinking ship
- Cost of expanding Medicaid: more than meets the eye
Is cost the only reason to not expand Medicaid?
Actually, cost isn’t the main reason that expansion is a bad policy. Expanding Medicaid to able-bodied adults threatens access to care for those currently enrolled in Medicaid – including low-income children, pregnant women, parents, individuals with disabilities, and the elderly.
There are not enough doctors accepting new Medicaid patients to accommodate the huge influx of new enrollees. The current Medicaid population often struggles to find care (learn more by watching Colleen’s story here). Expansion would worsen those problems, especially in rural areas where a higher percentage of the population could be newly eligible under expansion.
More information:
- NC doctors lack capacity to accommodate Medicaid expansion
- No, healthcare capacity will not increase to meet rising demand due to Medicaid expansion
Won’t Medicaid expansion help North Carolina’s economy?
Claims boasting about thousands of jobs being created courtesy of Medicaid expansion are based on a study with a lot of flaws (read more about that by accessing the articles below). But even if it were true that Medicaid expansion would create jobs, this is a job creation strategy that relies on keeping people financially needy enough to qualify for Medicaid and sick enough to use services that would draw down federal money into the state’s economy.
Seventy-eight percent of those newly eligible for Medicaid under expansion are single adults. If they worked full time at minimum wage, they would make enough to qualify for a free bronze plan on the federal insurance marketplace. We should be encouraging and helping adults like this reach their full economic potential, rather than seeking to trap them in government dependency.
Especially during a time of economic prosperity, we should not be trying to expand the welfare state in North Carolina.
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But what about the Republican healthcare bill that’s been proposed this legislative session – it’s not Medicaid expansion, is it?
Actually, House Bill 655, the “North Carolina Health Insurance for Working Families Act,” is an expansion of the state’s Medicaid program under the ACA. Unlike the expansion proposed by Gov. Cooper, this bill would require certain new Medicaid recipients to meet work requirements and pay monthly premiums. It is important to note that Medicaid work requirements in other states have been struck down in federal court, pending appeal.
More information:
- Carolina Cares 2.0: Medicaid expansion by another name is still Medicaid expansion
- The case against Medicaid expansion
So, what can we do to improve healthcare access in North Carolina?
Meaningful healthcare reforms are those that open up the market for competition, which would improve quality and drive down costs. This happens by scaling back government intervention and allowing healthcare to function as a free market. Truthfully, reform is needed at the federal level. But there are some clear actionable steps that North Carolina can take in order to reduce healthcare costs in our state – including facilitating telemedicine, licensure reciprocity, expanding scope of practice for certain providers, repealing Certificate of Need, and more (as highlighted in the resources below).
Adding more government intervention into the healthcare market will do more harm than good. North Carolina has an opportunity to lead the way in state-based free-market healthcare reform, instead of following other states down the path of more federal government dependency and intervention.
More information:
- Alternatives to Medicaid expansion
- Proposed free-market healthcare reforms a step in the right direction
- Could rise in telemedicine help alleviate rural medical deserts?
What if I want to learn more about the on-going policy battle over Medicaid expansion?
Civitas has you covered! Below, you can find our infographic, one-pager, and more. As we continue to cover this important issue, be sure to check our site for new content, as well.
Landing page: NCCivitas.org/MedEx
Infographic: Medicaid Expansion by the Numbers
One-Pager: Medicaid Expansion: Hurting the Needy, Harming the Economy
E-book: Why Medicaid Expansion is Bad for North Carolina
