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.
Doug Badger, a senior fellow at the Galen Institute, says young adults will be the group most adversely affected by the ban on short-term plans.
“Ages 26 to 34, in particular, have the highest uninsured rates in the country,” Badger said. “The reason for that is the ACA regulations charge them unfairly high premiums to subsidize, essentially, their parents. People in their twenties and thirties are asked to pay unfairly high premiums to subsidize those in the fifties and sixties, who purchase plans for unfairly low rates.” Skyrocketing premiums have reduced the number of young adults purchasing insurance, Badger says, and the short-term plans could help remedy that.
“A crisis of affordability.” That’s what is plaguing the individual health insurance market, according to Seema Verma, the administrator of the Centers for Medicare and Medicaid.
The culprit? Obamacare. The health law’s regulations have steadily driven up the cost of insurance. Between 2013 — the year before most of Obamacare’s provisions took effect — and 2017, premiums for individual plans doubled. They’re expected to jump another 15 percent next year.
The Trump administration handed the decision about whether to offer short-term, limited duration health care plans over to the states. California immediately passed legislation to ban the sale of these plans, which the Trump administration had expanded access to by allowing for a longer renewal period and carrying time. Doug Badger, an expert on these plans, talks about why California’s decision is bad news for people seeking affordable alternatives to Obamacare Exchange plans and how, despite this, the move to let states decide is the intent of a federalist system.
The recent editorial regarding the supposed benefits of Medicaid expansion to Louisiana overlooked several important facts. Your editorial correctly noted that enrollment in Obamacare’s expansion to able-bodied adults exceeded projections by more than 100,000 individuals. As a result of this underestimation, an expansion originally projected to total $1.2 billion to $1.4 billion annually cost an estimated $3.1 billion during the last fiscal year.
On July 24, 2018, liberal activists announced they collected enough signatures to place Medicaid expansion on Idaho’s November 2018 ballot. If voters approve this initiative, Idaho will expand the program to able-bodied adults that earn up to 138 percent of the federal poverty line.
Supporters of Medicaid expansion claim the program will generate millions of dollars in new revenue and save money, citing a recent report from the consulting firm Milliman. However, an earlier 2016 report from Milliman determined Medicaid expansion would cost Idaho almost $3 billion more than its new estimates. The firm argues its 2018 estimates are more accurate because Medicaid expansion has cost other states less than previously thought, but this claim is completely without merit.
A few states have found a key to undoing some of Obamacare’s damage to their individual health insurance markets by redirecting some federal funding to help sick people. These states are providing separate assistance to those with the highest health costs, thereby reducing premiums and increasing enrollment for healthy people driven out of the market by soaring costs.