More information always is better, and in that sense the Public Affairs
Research Council has done a service by producing a guideline for analysis of
whether Louisiana ought to accept federal money with considerable strings
attached to expand Medicaid eligibility. But unfortunately it falls short
conceptually, which makes vulnerable whatever recommendations would stem from
its suggested course of study to the criticisms it levies.
The report
reviews mainly two others from dispassionate, nonpartisan sources that provided
the starting point from which Louisiana officials to date have determined not
to pursue this option. However, some of its critiques also focus on problems
that cropped up in more partisan, less objective analyses (many already
addressed prior to this effort here).
Had the effort stopped just
at pointing out the shortcomings of analyses based upon these several reports,
little value would have come of it. But by then highlighting avenues of data
acquisition and analyses that policy-makers ought to pursue provides for a good
start. If state policy-makers already are not cognizant of these items in need
of periodic review, then this serves as a basic primer on them.
However, a major conceptual
problem hangs over it – a willful blindness to the fact that ideas have
consequences. That is, when certain incentives and disincentives are presented
to human beings, their behavior changes as a result. And throughout the report,
certain assumptions are not properly framed because they do not relate to the
real-world implications, not just of the expansion but concerning the entire
systemic overhaul of which the expansion plays a part, that they have on human
behavior.
In some places this failure sits
in the background. In its discussion of uncompensated care costs, it treads
through familiar territory about refusal of the expansion would jack up uncompensated
care costs an environment of presumably falling federal reimbursements for
those, and making (as befits a study focusing on meta-evaluation of others not
intended as analysis) that greater study occur on this issue for future
decision-making purposes. But it fails to recognize that the larger Patient
Protection and Affordable Care Act will squeeze supply, prompting potentially
greater, not lesser, emergency room usage for primary care than now, or at the
very least makes the assumption of demand shift less in degree, meaning that any
presumed “savings” realized by expansion because of limitations of UCC funds is
untenable.
Nor does the study explore
the likelihood, as the costs of the entire new law continually are revised
upwards, that this nightmarish growth will continue in reality after
implementation, prompting the federal government to reduce its, as of now
written into law, 90 percent match for 2020 and beyond (even though it
acknowledges it “will remain at that level unless the rules of the match are
changed”). Already the match for
traditional Medicaid is much lower (and an adjustment down with that months ago
creating
some budgetary chaos) and there’s no reason to think this one cannot drift
down to that level currently in the low 60s of percent. No recommendations of
introducing some kind of contingency analysis that would capture the
higher-than-predicted costs to the states for the futures of this or UCC
dollars appear, which surely must be a part of any decision calculus, lest the
state become victimized by a bait-and-switch.
Yet in one place there
exists a very obvious error, in the discussion about how much a state “gains”
from expansion. The thinking is that the federal government pumps in hundreds
of millions of dollars a year, increasing economic activity. The problem comes
from the report’s utter disregard that the money doesn’t just come floating
down from the sky. Rather, it comes from the pockets of Louisianans, and from all
American citizens and/or workers. This will have a decidedly
negative economic impact on the state and country.
While one could argue that if
state tax receipts will suffer because of the drag produced on the economy regardless
of expansion then the state ought to get its “share” of federal largesse by
opting for expansion (not exactly true – Louisianans will have slightly higher
costs to pay for this added portion of recipients, either now in the form of taxation
or later in the form of debt), the incremental direct state costs to expansion –
administrative (for each incremental client and regulating this new class),
regulatory (state businesses having to track people coming on and off their own
programs), systemic (substituting more people into the less effective, less
efficient Medicaid system from private provision) and allocable (forcing
resources into the system that might be better spent on other government
activity, also both on grounds of efficiency and effectiveness) – also exist
that would not without expansion for which Louisianans will have to pay, now or
later either in resources or in loss of other services. No suggestion appears
in the report to investigate this aspect (aside from professing skepticism that
Arkansas will reap a certain amount of revenues as a result of expansion).
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