• Why (some) governors oppose the Medicaid expansion

    There’s a new Perspectives piece over at NEJM that analyzes statements by governors wo support or oppose the Medicaid expansion. Here are rationales behind opposition:

    Among governors opposed to expanding Medicaid, statements about affordability and impact on state budgets were nearly universal (92%). Cost concerns fell into several categories. Some pointed to the so-called woodwork effect, in which the ACA could draw previously eligible but unenrolled persons into Medicaid, at greater cost to the state. More than half the governors opposing expansion predicted that the federal government would renege on the generous terms of the ACA and scale back its share of Medicaid spending. Newly elected Governor Mike Pence (R-IN) compared the expansion to “the classic gift of a baby elephant. . . . The federal government says, `We’ll pay for all the hay — for the first few years.’”

    Beyond cost, governors expressed concern about the lack of state flexibility or their belief that Medicaid may foster dependence among beneficiaries. For instance, Dennis Daugaard (R-SD) declared that “able-bodied adults should be self-reliant” — in contrast to children or people with disabilities, the traditional Medicaid beneficiaries. Others argued that Medicaid itself is the problem, calling it a “broken program” that provides poor care. Most vividly, Rick Perry (R-TX) said that adding uninsured Texans to Medicaid is “not unlike adding a thousand people to the Titanic.”

    None of this should be new to readers of the blog, but unfortunately, not everyone in the country is yet a regular reader.

    I understand the “woodwork effect”, but that will happen with or without the expansion. Fear of the individual mandate will drive people (even if they were exempt from it) to get insurance. The increased public perception of the availability of insurance will also drive those who are eligible for Medicaid to claim it. Therefore, I’m not sure that denying the expansion will protect states from this issue.

    Others fear that the government will renege on its obligations. I guess they could? But they could do that on any program, including traditional Medicaid. Plus, they could put in a protection against that, as Gov. Brewer recommends.

    The rest is harder to entertain. Medicaid works. There’s no magical innovation just waiting to be enacted.

    I still think it’s going to be harder and harder for those opposed to keep this up as time goes on.


    • One question: what value is Brewer’s “protection” in a world with maintenance of effort requirements? The “circuit-breaker” is meaningless if the federal government can just impose a new MOE on states after they opt-in to the voluntary expansion.

      Unless you believe the MOE is unconstitutional, that is.

      • Not that Congress can’t change things later, but I believe Sebelius issued a letter back in the Fall that said that states can opt in and out of the expansion at will. The value of the circuit breaker is that it is automatic, not requiring further action by the state legislature and governor. Seems about the best attempt to have it both ways a state can do at this point.

        • A non-binding letter isn’t much, to be quite honest. Especially when states have always been able to opt-in and opt-out of voluntary expansions at will… until the feds hand down an MOE.

    • To those of you who live in America’s “mirror world”, if a provincial premier made any of the statements put forward by American governors, they would probably have to resign within the week. In the part of the real world occupied by my province, the government is actively seeking out people infected with HIV to bring them into treatment; obvfious reason – HIV treatment reduces viral load which appears to reduce transmission of the disease (thus avoiding medical costs in the future).

      Why bother spending a trillion dollars a year on the war department and the snoops to “protect” your people, yet spend nothing to prevent 50,000 people a year from dying because they can’t afford medical treatment?

      If the Canadian federal government showed up with $100 million of new health-care funding, a province would rush to the bank. If the funding disappears, the province can blame the feds in the future.

      The most insulting is the “broken program” comment which deserves only one TeaParty/GOP response: You Built It!

    • Also I think creating a situation where there is a possible woodwork effect is deeply immoral. “People are entitled to this benefit but we will make it as difficult and uncomfortable to collect it as we can in the hope that they will give up and go away so we won’t have to spend money on them.”
      I agree that as soon as the insurance marketplaces actually are operational (and yes there will be some growing pains there) and able to direct people to Medicaid or subsidies most of the woodwork people will be signed up for Medicaid fairly quickly.

      • Sarah,

        A great deal of the “woodwork” problem is from people who don’t need Medicaid, but will have it forced on them–many people with current coverage by their spouse or employment are forced onto Medicaid by the exchanges. The law requires this.

        Forcing people into inferior programs they don’t want–that’s the immoral course.

    • As someone intimately familiar with the new health control law and stridently opposed on all fronts, I find some of these remarks somewhat remarkable.

      There’s little reason supporting the idea that the “woodwork” problem happens without Obamacare’s Medicaid expansion, except perhaps to the extent it happens as a consequence of the health law itself. The law requires (and provides) that the woodwork people be very actively sought out by the agents of Obamacare and added to the Medicaid rolls, against their will if necessary. See, for example, section 1311(d)(4)(F), or the explanation here:


      In my state, the “woodwork” problem would increase the state’s direct expense of one of its most expensive programs by 67%, to serve people who’ve largely opted out because they’re already served (thru employers, coverage thru a spouse or partner, etc.).

      As far as the claim that “Medicaid works”, the link contains a reference to a pseudo-scientific “study” asserting that Medicaid stimulus spending generates 2x its weight in increased GDP, a classic idiocy. Were that the case, the gov’t should force us all on Medicaid as an investment to reap the 200% returns. We’d all be rich.

      (Sorry, I’m not trying to be rude, I’m just frustrated at what passes for reasoning and logic these days. We’re revisiting questions and fallacies that were thoroughly addressed centuries ago. There’s a constant attempt to get something-for-nothing by people who think making it more complicated until no one can follow the shells’ positions changes the fundamental facts. Mandating services doesn’t make them free, it makes them more expensive. Period,)

      • Why would the mandate and increased publicity about Medicaid eligibility not bring people out of the “woodwork”?

        And, please, we’ve written about how Medicaid works all over the place, including the NEJM. There are tons of posts here that detail why. Anyone who comes on here and dismisses all of them, without citing any of them, isn’t trying very hard.