#ALpolitics could STILL $ave money if they were to #ExpandMedicaid

Alabama, among other states, should have expanded Medicaid when they had the opportunity to do so, and with SIGNIFICANT REWARD! In other words, at the very first. Now, if any state decides to expand Medicaid, there’s little, if any, incentive, except that there will be some savings to the state, and benefit to their citizens, by having access to healthcare.

A sick workforce can’t survive.

The Centers for Disease Control and Prevention (CDC) continually tell America that the sickest, the fattest, the most diabetic, the most smokers, and cancer-ridden, are in the Southeast… which largely voted for Trump, and has been predominately GOP-voting for at least the past 25+/- years. And I write of Alabama in particular.

In a November 2012 brief entitled “An Economic Evaluation of Medicaid Expansion In Alabama under the Affordable Care Act” by Professors Drs. David J.Becker, Ph.D.and Michael A. Morrisey, Ph.D of the University of Alabama at Birmingham School of Public Health, Lister Hill Center for Health Policy, they presented the case for the numerous potential benefits of expanding Medicaid in Alabama, which was not merely an improvement in the overall quality of life for Alabamians, but significant economic benefit to the entire state.

Drs. Morrisey and Becker are Professor and Director, and Assistant Professor, respectively, at the University of Alabama at Birmingham School of Public Health, Lister Hill Center for Health Policy, and have researched and written extensively the subject. The University of Alabama at Birmingham is one of three independent, autonomous universities in the UofA System.

Then-Governor Dr. Robert Bentley, MD, a Republican, was forced to resign in shame in the midst of his second term after pleading guilty to charges of corruption and ethics violations, and refused to expand Medicaid in “Sweet Home.”

The Bureau of Labor Statistics has most recently shown that employment in the Healthcare sector is thriving nationwide. The figures below are from the BLS’ most recent report “THE EMPLOYMENT SITUATION — MARCH 2018,” and is expressed in thousands. The columns in order, are: Not Seasonally Adjusted, March 2017, January, February, March 2018, and Seasonally Adjusted for the same times, respectively. (ESTABLISHMENT DATA Table B-1. Employees on nonfarm payrolls by industry sector and selected industry detail)

Drs. Morrisey and Becker identified that had then-Governor Bentley expanded Medicaid, a Federal/State program that pays healthcare costs for the impoverished, the state could have not merely eked it’s way out of recession, but it would have propelled itself in rocket-like fashion, to a position of economic strength and stamina.

They cited a provision in the Patient Protection and Affordable Care Act (ACA) which provided incentive to states to expand Medicaid by offering a one-time bonus of paying for 100% of all costs in 2014, followed by nominal reductions each year thereafter. And if states chose to expand Medicaid, they would have paid LESS (a smaller percentage) even after all incentives expired. Medicaid is a Federal-State sharing program in which the states bear a certain portion, while the Federal Government picks up the remaining share.

They wrote in part, that “Under the ACA, Alabama would receive a significantly higher Federal Matching Assistance Percentage (FMAP) for the expansion population than the 68.5% it currently receives for the non ‐ expansion population. The ACA provides for a uniform FMAP to all states of 100% in 2014 ‐ 2016, 95% in 2017, 94% in 2018, 93% in 2019 and 90% in all years thereafter.”

Presently, because Alabama has chosen to NOT expand Medicaid under the provisions of the ACA, they are STILL paying MORE for Medicaid than if they would have expanded it… even now, in 2018. That’s because the OLD law, under which the state labors, requires Alabama (and other states that did not expand Medicaid) to pay 31.5%. If Alabama would EXPAND Medicaid even now, in 2018, they would pay only 10%.

Governess Kay Ivey, also a Republican, who as Lt. Gov. assumed office following Bentley’s resignation after pleading guilty to corruption and ethics violation charges, has similarly expressed her reticence to expand Medicaid.

In 2016, Alabama spent $5,461,151,125 for Medicaid.

Noting that their “analysis does not consider potential savings from reduced spending on uncompensated care, mental health care and other services currently provided to the expansion population,” assuming the state expanded Medicaid and would pay “6.2% of program costs through 2020,” Drs. Morrisey and Becker projected three scenarios of a high, moderate, and low “take-up,” meaning enrollment into the program, and wrote that, “we estimate that the state of Alabama would be responsible for $771 million (6.2%) of the estimated $12.5 billion in new Medicaid program costs over the 2014 ‐ 2020 period,” and noted specifically, that “If more previously uninsured or privately insured individuals elect to enroll in Medicaid costs to the state and Federal government would rise. If take ‐ up were lower, the costs to the state and Federal government would fall.”

If Alabama had chosen to expand Medicaid in 2016 – the last year the Federal Government paid 100% of ALL COSTS of expansion – the state would have SAVED $5,461,151,125… the TOTAL cost of Medicaid. If Alabama were to expand Medicaid in 2018 (this year), they would pay only 6.2% of the costs, while the Federal Government would pay 93.8%. Using a high “take-up” scenario for 2018, Drs. Morrisey and Becker projected the state would pay $243,000,000… about 77.5% LESS than what it paid in 2016. A low “take-up” scenario for 2018 would be 46.48% lowered costs to the state.

The state has a peculiar and non-standard practice of having TWO budgets, the Education Trust Fund and General Fund budgets. Medicaid is paid from the General Fund budget, which is the smaller of the two, and receives “Taxes from over 40 sources are deposited into the GF, with the largest sources being the insurance company premium tax, interest on the Alabama Trust Fund and state deposits, oil and gas lease and production tax, cigarette tax, ad valorem tax, and Alabama Alcoholic Beverage Control Board profits,” and pays for and “supports state programs such as child development and protection, criminal justice, conservation efforts, economic development, public health and safety, mental health, Medicaid, legislative activities, and the court system.”

The much larger Education Trust Fund, receives revenue from “Ten tax sources are allocated to the ETF, the largest of which are the individual and corporate income tax, sales tax, utility tax, and use tax.” Revenues from the Education Trust Fund “support, maintenance and development of public education in Alabama, debt service and capital improvements relating to educational facilities, and other functions related to educating the state’s citizens. Programs and agencies supported by the ETF include K-12 education, public library services, performing and fine arts, various scholarship programs, the state’s education regulatory departments, and two- and four-year colleges and universities. Funding from the ETF is also provided to non-state agencies that provide educational services to the people of Alabama, including the arts, disease counseling and education, and youth development.”

Medicaid requires states to cover:
• Pregnant women up to at least 138% of the Federal Poverty Level (FPL) ($16,643 for an individual, $33,948 for a family of four in 2017)

• Preschool-age children up to at least 138% of the FPL ($16,643 for an individual, $33,948 for a family of four in 2017)

• School-age children up to at least 100% of the FPL ($12,060 for an individual, $24,600 for a family of four in 2017)

• Elderly and disabled individuals up to at least 75% of the FPL ($9,045 for an individual, $18,450 for a family of four in 2017)

• Working parents up to at least 28% of the FPL ($3,376 for an individual, $6,888 for a family of four in 2017)

Moreover, however, Alabama could have improved its economy by expanding Medicaid. In that same report, Drs. Morrisey and Becker considered three possible scenarios also based upon a high, moderate, and low “take-up” rate which showed that Alabama could have benefited between $2.331 billion and $33.529 billion in additional value added to the state’s economy from 2014-2020 (Low-to-High, inclusively and respectively).

They concluded that, using the intermediate, or moderate “take-up” scenario, “we project that a coverage expansion would reduce the state’s uninsured population by approximately 232,000 individuals while generating $20 billion in new economic activity and a $935 million increase in net state tax revenues.”

Again, that does NOT include the savings from eliminating uncompensated care.

Bottom line?

It would STILL be exceedingly wise for Alabama to expand Medicaid.