February
17, 2021 Northeast
Georgian, The (Cornelia, GA) By Kyle Wingfield
Georgia did not expand
its Medicaid program under the Affordable Care Act, as everyone knows. Except
that, in a manner of speaking, it did.
Since the Affordable Care
Act was passed, Georgia has increased its Medicaid rolls by almost the same
number of people projected under expansion. Spending on Medicaid, including
both state and federal funds, likewise has increased by about the same amount
as projected under expansion.
Oddly enough, the many
benefits promised if the state expanded the program have not been realized.
That mightn't seem so odd to opponents of the idea, some of whose warned
negative impacts actually have come to pass.
First, let me explain. It
is true that Georgia has not raised the income ceiling for Medicaid to 138% of
the federal poverty level, as envisioned in the Affordable Care Act, aka
Obamacare. But it is also true that Georgia nevertheless has seen a comparable
surge in Medicaid enrollment.
Between 2010, when
Obamacare was passed, and September 2020, the most recent month for which data
are available, enrollment grew by more than 490,000 – an
increase of almost one-third. That compares to projections that expansion would
increase enrollment by about 650,000 per year during the first decade.
Similarly, Georgia's
total spending on Medicaid has grown by about $4 billion during that time. The
projections for expansion were about $4.5 billion per year during the first
decade.
In other words, while
Georgia did not expand eligibility, the results have been about the same, in
terms of new spending and enrollment.
Now for that
aforementioned oddity. Proponents of expansion claimed a bump in Medicaid
spending would boost the economy: creating tens of thousands of jobs,
increasing sales taxes by millions of dollars and –
perhaps most often invoked – saving rural hospitals. Yet, the bump Georgia did experience
appears not to have had those effects.
Yes, healthcare
employment increased during the past decade. But it grew at a slightly slower
clip (28%) than during the previous 10 years (30%).
Meanwhile, state sales tax
revenues have not even kept up with inflation. If there was a hidden boost from
all this Medicaid spending, it is well-hidden indeed.
Finally, the rural
hospital closures have slowed but not ceased; two more closed their doors in
2020. Two of the main drivers in this sad trend, Georgia's declining rural
population and the low percentage of rural patients with insurance that pays
the full cost of the care they receive, aren't helped by a surge in Medicaid
coverage. Because Medicaid pays less than the full cost of care, it most likely
would mean the hospitals simply saw more patients on whom they lost money.
At best, this would only
slow the bleeding, not stop it. That's why the notion that more Medicaid would
lead to more doctors and financially healthier hospitals –
without a significant increase in reimbursement rates, which are never factored
into the expansion's costs – has always been fanciful.
But there is one
prediction about expansion that has come true: Medicaid has swallowed the state
budget.
I've heard complaints
lately about a decline in state spending per capita since before the Great
Recession. Comparing the peak before one recession to what we hope is the low
point after another one is rather unorthodox, but let's go with it for the sake
of argument.
This supposed decline is
true only in a narrow sense: Including only state funds, and adjusting for
inflation, Georgia plans to spend about $67 less per person in the next budget
than in 2008. Including federal funds, however, spending will be higher.
Yet, even as real state
spending per capita has fallen slightly, it has risen by $76 per resident for
Medicaid. Expansion would have piled more spending on top of that. Even without
expansion, Medicaid has crowded out new spending for most other state programs.
The answer is not to sink
another $4.5 billion per year, and hundreds of thousands more enrollees, onto
this broken program. It's to seek better ways to improve healthcare access for
all Georgians, in a way Georgia can actually afford.
Kyle Wingfield is
president and CEO of the Georgia Public Policy Foundation, found online
at www.georgiapolicy.org.
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