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July 30, 2014

Making the case for Medicaid expansion

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Posted: Monday, February 10, 2014 7:46 pm

Alabama’s hospitals are bracing for a cut in funding from the federal government as more provisions of the Affordable Care Act come into play, and some in the industry see Gov. Robert Bentley’s refusal to expand Medicaid in the state as part of the problem, not part of the solution.

Providing medical care for uninsured patients unable to pay is simply part of the business of providing medical care. Coosa Valley Medical Center CEO Glenn Sisk said his hospital provides about $19 million in uncompensated care each year. Citizens BMC President Joel Taylor said uninsured patients cost his hospital about $3.3 million annually. They were just two speakers at a public forum in Sylacauga Friday where arguments were presented in favor of the expansion.

Federal subsidies for indigent care have boosted the bottom line over the years, but as part of the Affordable Care Act, those subsidies are going away. That’s because the number of uninsured patients was supposed to take a nosedive once the law took effect. People able to purchase insurance were going to be required to do so, and eligibility rules for Medicaid were supposed to be changed to enable the poor to sign up for coverage in the states where they live.

One of the court challenges to the law changed the Medicaid mandate. The Supreme Court accepted the argument that states should not be forced to expand their Medicaid programs, and Alabama is one of the states that chose not to do so. That development was unanticipated, and the ACA provides no way around the end of the subsidies. The bottom line: hospitals will lose federal help for treating people unable to pay, and those people still will not have insurance.

Gov. Bentley put together a task force to administer the Medicaid program in the state in a new way in an effort to make tax dollars stretch farther. That’s an interesting approach to the problem, but he has refused to change the rules about who qualifies for Medicaid. The new federal guidelines would allow anyone below 133 percent of the poverty line to sign up. In Alabama, an additional 200,000 to 300,000 people would be covered under Medicaid if eligibility is expanded to meet the new guidelines.

The federal government promised to cover the full cost of expansion for the first year for all the states, with the percentage of federal aid decreasing to 90 percent of the expansion by the 2020. States that decide to expand later will miss out on the 100 percent level of federal support.

Estimates are the money from the expansion in Alabama would be about $1.5 billion the first year, and would add some 31,000 jobs in the state. That would be about $4.5 billion the first three years at no cost to the state, followed by a cost of five cents on the dollar for three years, and a dime for a dollar after that. That's money that not only provides an economic impact in the state, but gives a helping hand to lower-income Alabamians.

Gov. Bentley is standing firm by his decision. He argues the state will be better off without expanding Medicaid, already one of the state’s most expensive programs, and he has expressed doubts the federal government will fulfill its part of the bargain.

Without the expansion hospitals in the state — especially rural hospitals — will be feeling the crunch.

There are plenty of Washington politicians who would like to see Obamacare repealed, replaced or amended, but the future of the law is not in the hands of our state’s governor or Legislature. What they can do is work to improve the future of Alabama. They can help create jobs, boost the economy, and help improve the lives of people across the economic spectrum. But they can’t do it by thumbing their noses at a federal law beyond their control.

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