Skip to content

#FullRepeal Daily Digest

Bloomberg: Best Argument Yet Against Medicaid Expansion

  • Opponents of Obamacare’s Medicaid expansion have traditionally argued that it will significantly burden state budgets and provide people with substandard health coverage. A new academic paper suggests what may be the strongest argument yet against the expansion: that it will keep many beneficiaries in poverty because it creates strong disincentives for work.
  • ...a National Bureau of Economic Research working paper [argues] that Medicaid enrollment will lead to significant and lasting reductions in employment among childless adults. The paper is noteworthy primarily because it focuses its analysis on low-income adults without children -- -- a group that previously was largely ineligible for Medicaid but will get access because of Obamacare’s expansion of the program. It reinforces a July 2013 paper, which found that the loss of public health insurance stimulated job search activities, employment growth and the acquisition of other health insurance coverage among childless adults.
  • Dague and her colleagues conclude that if the Medicaid expansion enrolls about 21 million additional adults, anywhere from 511,000 to 2.2 million fewer people will be employed. Furthermore, they argue that the Medicaid expansion will knock almost a full point off of today’s labor force participation rate -- or share of the civilian population that is working -- a measure of economic health that is already at its lowest point since 1977.
  • [RELATED] NBER: The Effect Of Public Insurance Coverage For Childless Adults On Labor Supply
    • [Medicaid expansion means less work and less earnings] Our evidence suggests the net effect on earnings (including those who lost or changed jobs) was a reduction of $100-300 per quarter.

Washington Post: Medicaid enrollment is growing faster than expected in some states. It's going to cost them.

  • …states that have rejected Obamacare's Medicaid expansion had seen their Medicaid enrollment grow anyway, thanks to what's known as the "woodwork effect." Medicaid is built to serve low-income Americans, and many of these people were already eligible for the program but only decided to enroll  after the Obama administration launched a massive outreach campaign to get people covered and to pressure states to expand their programs.
  • From a state budget perspective, there's an important difference between the woodwork population and those newly eligible under the Medicaid expansion. Under the Affordable Care Act, the federal government pays 100 percent of the costs for the Medicaid expansion population through the end of 2016, with the state share gradually increasing to no more than 10 percent. New woodwork enrollees are funded under the traditional Medicaid structure, in which the federal government on average pays 57 percent of the cost — though the federal share varies by state.
  • At least a couple of states have already cited higher-than-expected costs from the phenomenon. California officials on Tuesday said the woodwork population is expected to grow 60 percent more than what they had expected, costing the state additional $1.2 billion. Rhode Island is now expecting to pay $52 million more than previously projected over two years after Medicaid sign-ups beat expectations by more than double.
  • This graph from a December 2012 NASBO report shows how Medicaid has been taking a greater portion of state general funds, while education spending has decreased.
  • [RELATED] Washington Examiner: After Obamacare, nearly one out of three Californians will be on Medicaid
    • As the Los Angeles Times reported, the administration of Gov. Jerry Brown has revealed that the state now expects 1.4 million more Medicaid beneficiaries than previously projected, bringing the state total to 11.5 million.

Fox News: Health care's hidden tax on Main Street

  • …a hidden tax within the law is coming to light that threatens the very livelihood of thousands of U.S. businesses and millions of American workers. Known as the health insurance tax or HIT, this is a new discriminatory tax on small businesses and their employees that will raise the premiums by as much as $500 per policy per year.
  • Main Street enterprises are now being faced with the choice of eating the costs, passing it on to their employees, ending coverage altogether or other unexpected decisions impacting their operations and workers.
  • Adding to the confusion is the fact that the cost of the tax is only going to grow over time – collecting an estimated $145 billion from small businesses in the first ten years alone and making it that much harder for business owners to prepare for the future.
  • …during one of the ACA’s many back door deals, large corporations and unions received a carve-out from the HIT, leaving the full burden of the tax to fall on the fully-insured marketplace, where nearly 90 percent of small businesses, their employees and the self-employed purchase their insurance.
  • Weaken that important sector and the chances of a full economic recovery are grim at best as businesses are stifled and job loss increases. In fact, the National Federation of Independent Business (NFIB) projects that unless the HIT is eliminated, private-sector employment through 2022 will be reduced by as much as 262,000 jobs, with 59% of those losses falling on small business.

MarketWatch: Many Patients with Exchange Coverage to Pay More than Twice As Much Out Of Pocket for Prescriptions Compared to Employer Plans

  • A new report by Milliman, Inc. finds that Silver plans with combined deductibles offered through the Health Insurance Exchanges may require patients to pay more than twice as much out of pocket for prescription medicines overall as they would under a typical employer plan. This is a far larger increase in out-of-pocket costs than was found for other medical care.

Politico: BURWELL WANTS TO RECOVER FUNDS SPENT ON FAILED EXCHANGES

  • Watch out, blue states. The presumptive successor to HHS Secretary Kathleen Sebelius says she’s ready to use “the full extent of the law” to recover funds “misused” on state-run Obamacare exchanges that failed to deliver. During her nomination hearing before the Senate Finance Committee, Sylvia Mathews Burwell said she wants to learn from the failed exchanges — most prominently in Oregon, Massachusetts, Maryland and Nevada. “When we do understand…we need to go to the full extent to the law if there are contractors or others that have misled through their contracts or other things to fully recover,” she said.
  • [RELATED] Bloomberg: The Little States That Couldn't on Obamacare

 

Previous
Next