Officials in states across the U.S. showed little interest for years about looking into the black box of pharmacy benefit managers, the pharmacy supply-chain middlemen who have been shrouded in secrecy as they pour billions of dollars worth of prescription drug rebates into state coffers.
Louisiana’s legislative auditor wanted to know how the state’s expansion of Medicaid under Obamacare was doing, so he picked 100 people who were deemed eligible under the rules.
He found that 82 of them made so much money that they shouldn’t have qualified for the benefits they received.
Auditor Daryl G. Purpera, who issued his findings last month to little fanfare outside of Louisiana, figured if those statistics hold true for the rest of the expanded Medicaid population in his state, then the losses to ineligible beneficiaries could be as high as $85 million.
The Trump administration has again approved new rules for some of Kentucky’s Medicaid population, requiring them to either get a job, volunteer in the community or go to school to keep their government-funded health coverage.
The Kentucky Cabinet for Health and Family Services announced the approval on Tuesday, nearly five months after a federal judge blocked the state’s first attempt. State officials say the new rules can begin as soon as April 1 and will be phased in regionally over several months. They will require adults ages 19 to 64, with some exceptions, to complete at least 80 hours per month of “community engagement” to keep their health benefits. That includes getting a job, looking for a job, going to school, volunteering for community service or taking a job training course.
Texas v. Azar likely will incite another episode of Washington hysteria and irrationality. It also will give states the chance to divert health care policy from its calamitous course.
Congress should proceed deliberately and let states lead the way.
In May New Jersey imposed a health-insurance mandate requiring all residents to buy insurance or pay a penalty. More states will feel pressure to follow suit in the coming year as the federal mandate’s penalty disappears Jan. 1 and state legislatures reconvene, some with new Democratic majorities intent on “protecting” ObamaCare. But conflicts with federal law will make state-level health-insurance mandates ineffective or unduly onerous, and governors and legislatures would do well to steer clear.
California’s next governor Gavin Newsom is an avowed single-payer supporter in the country’s most populous state. But how much of his stand is principle and how much is policy is not totally clear. And no matter how he handles it, he’ll inevitably anger part of his base.
That, in a nutshell, is a preview of the Democrats’ health policy dilemma heading into the 2020 election cycle. Single payer, or “Medicare for All,” has become a litmus test for the growing number of Democrats who are contemplating challenging President Donald Trump. Newsom’s stance gives supporters some cover, turning the issue mainstream. But making good on the promise carries big risk — even for a politician who won by a nearly 20-point margin.
Virginia is facing a huge bill for unexpected Medicaid costs that hamper proposed new spending on things like school improvements or tax breaks for the poor. State officials said Friday that Virginia has about $460 million in unforeseen Medicaid costs. Secretary of Finance Aubrey Layne said much of the new costs stem from faulty forecasts overestimating the benefits of having private health insurers cover a greater number of some of the state’s more costly Medicaid recipients. Another reason for the increase is a higher-than-expected enrollment of children in the state’s Medicaid program, he said.
President Trump’s Department of Health and Human Services recently announced welcome new guidance to states looking to improve their health care and health insurance systems through “state innovation waivers” under Section 1332 of the ACA. The new guidance gives states significantly more flexibility to devise creative solutions to meet the health care and insurance needs of their constituents and it builds upon new community engagement waivers that made Medicaid more flexible for states earlier this year. Section 1332 allows states to experiment and creatively tailor their health care coverage programs under certain conditions.
Many readers no doubt take comfort in living thousands of miles away from the tax and spending misadventures of Illinois or Connecticut. But fair warning: One of the worst deals in state spending is coming to a red state near you, and that’s expanding Medicaid to adult men above the poverty line. The perversity of spending more on childless men than pregnant women is reason enough to reject expansion, but there are others. Every state that has expanded Medicaid has blown the budget by spending more money on more people. The cost overruns are more than double on average.
Medicaid was designed for providing health care to low-income pregnant women, children, the elderly and the disabled. Expanding it beyond its original purpose is driving a nearly $300 million hole in the Kentucky state budget. Expansion made it harder for Medicaid’s core users to get the care they needed, and harder to reduce waiting lists of children with developmental disabilities who need critical therapeutic services.
These outcomes are not unique to Kentucky. Nationwide, the per-person cost of expanding Medicaid has exceeded projections by 76 percent. Enrollment has nearly doubled original estimates. And predictions about the total cost missed the mark by 157 percent.
If Utahns approve Proposition 3, they’ll be signing up for the same financial disaster.