Free Stuff, Isn’t

By Beacon Staff

Medicaid expansion under the Affordable Care Act (Obamacare) has been a festering Montana issue since last spring. Late in 2012, the U.S. Supreme Court ruled that the federal government could not strip away existing Medicaid funding from states that did not accept funding for Obamacare Medicaid expansion.

The Obamacare expanded Medicaid program allows all citizens earning up to 138 percent of the federal poverty level – about $32,000 for a family of four – to choose to join those Montanans already on Medicaid.

However, late in the 2013 session, the Montana Legislature narrowly refused to take the funding, even though the federal government will pay the entire tab until 2017, and 90 percent of the expanded program afterward.

Should the Legislature have grabbed the money? Medicaid expansion is, of course, broadly supported by Montana’s political left, and a significant number of “centrists.” Conservatives don’t like it at all – which mirrors the national scene in which Obamacare itself passed without a single Republican vote in Congress.

Now voters are facing competing ballot initiatives. From the left comes I-170, with the sponsor-of-record being Kim Abbott, co-director of the Montana Human Rights Network. I-170 would mandate that Montana take the money.

There’s also some “nonpartisan” support. Montana Hospital Association likes Medicaid expansion, of course. That’s like Boeing supporting more funding for the Air Force.

From the right comes I-171, sponsor Matthew Monforton, who has been raising quite a stir with various conservative-aiming lawsuits, and is also running for Legislature from Bozeman. This initiative would mandate that Montana reject all things Obamacare, not just Medicaid expansion.

Both initiatives will need to gather 24,000 signatures to make the ballot. Gov. Steve Bullock, with appropriate ceremony, has already signed on to I-170.

I’ll be signing one, but prefer both fail to make the ballot – I’m a representative Republican, not a direct Democrat.

The Montana Budget and Policy Center claims that Montana is supposedly “losing” $1.8 million in daily federal funding that would spill $1.3 million in labor income each day for 12,000 new “good-paying” healthcare jobs, and non-federal taxes of $135,000.

First, let’s look at the jobs claim. Using the Policy Center’s numbers, the expansion funds boil down to $108 per day per job created by expansion, or $13.50 per hour – $27,000 a year. But according to the Census Bureau, Montana’s average wage per job in 2011 was about $35,000. So, because doctors, nurses, lab techs and other specialists are included in the total, it’s clear the vast majority of expansion jobs will be low-skill, not-so-good-paying jobs.

Next, let’s look at what Medicaid costs taxpayers. The Bureau of Business and Economic Research at University of Montana produced a report modeling the costs of expansion last year. Current Medicaid enrollees cost $9,504 per patient per year – with the range being from around $3,000 per year for younger, with-kids enrollees up to an average of $23,000 per year for the “aged.”

Pretty spendy already…

Finally, let’s look at who really pays the freight. Right now, the existing Medicaid regime has the federal government paying 68 percent of the tab for Medicaid, or $274 of $404 billion a year. The states are responsible for the other 32 percent, some higher, some lower.

Under the Obamacare expansion, the state burden would be “only” 10 percent. But this is just an illusion. It’s convenient, but profoundly wrong, to pretend that federal funding is better or less burdensome than direct taxation at the state and local level.

Keep in mind that about 450,000 Montanans now have jobs. Multiply 70,000 expanded enrollees by $9,504, and you get $665,280,000 per year. Per Montana taxpayer, that’s $1,478 per year. Might you get a little upset if your taxes were raised directly? Heck yeah, which is why proponents insist that “federal funds” will “pay” for Medicaid expansion.

Trouble is, “federal funding” doesn’t fall from the sky. It has to be skinned off someone’s hide somewhere – and the shameful fact is, we are skinning our grandchildren, and have done so for so long, we’re already $17 trillion in the hole.

Medicaid expansion will not provide “free” health care for anyone, never has, and never will.

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