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Mendacious letter distracts from expansion problems

When you can’t refute the argument, avoid addressing the argument – a time-honored strategy Louisiana Department of Health Secretary Rebekah Gee employed in a letter to the editor addressing my recent Baton Rouge Advocate column that mentioned Medicaid expansion. Better, she not only dodged it, she added in some misdirection and misinformation on top of that.

That column really focused more on the “surprise” the Gov. John Bel Edwards Administration experienced when a budget deficit for this fiscal year appeared in its calculations, which to anyone conversant in economics would have expected: you raise taxes the equivalent of nearly 20 percent of general fund revenues and the resulting depression of economic activity will cause revenues to undershoot projections, especially as the Legislative Fiscal Office used a static model of revenue generation in formulating the impact of the hikes. However, the piece also mentioned the spending side, pointing out that almost the entire increase in the FY 2017 budget in state general fund dollars – the receptacle for the tax increases – came in health care spending.

That over $500 million increase stands in stark contrast to the alleged $184 million Medicaid expansion “savings” asserted by Edwards through his implementation of it – a figure which Gee’s department never has explained its derivation despite numerous questions from this space and others about that. The only study, by the department during the former Gov. Bobby Jindal Administration prior to Edwards’ election, cast serious doubt on those numbers and projects over the next several years the state would pay billions of extra dollars (shortly after the change in administrations, the new regime removed this and a successor paper from Health’s web site).

Further, initial data collected and actions since implementation reduces the figure’s plausibility even further. Recently, Health reported it underestimated expansion costs by $376 million, or about 5 percent of all state-resourced Medicaid spending. Further, deals made to fund adequately the state’s statutory requirement that it provide free care at designated hospitals to anyone uninsured making twice or below the federal poverty level received $135 million more, a 6 percent increase.

Health rather disingenuously brushed off the half-a-billion-plus dollar cost escalation for indigent care by claiming federal money would take care of it and any state share would be covered by a “sick tax” on many hospitals and health maintenance organizations. Of course, Louisianans pay those federal taxes and/or the debt that funds this “free” federal money and also suffer higher insurance premiums and/or deductibles and/or reductions in coverage and/or out-of-pocket expenses when hospitals and insurers pass the sick tax along to them.

But Gee mentions none of this in her letter. After writing my piece is “misleading,” she changed the subject entirely and provides no evidence to sustain that argument. Instead, she launched into a laundry list of positive outcomes supposedly linked to Medicaid expansion while providing no evidence to prove it could produce better outcomes than any alternative arrangement, nor addresses potential failures of a system that Sen. Bill Cassidy accurately calls the “illusion of coverage without the power of access.” For example, it’s well established that outcomes for Medicaid clients are no better than those similarly situated without insurance – yet incredibly she also claimed expansion will lead to better outcomes than prior to it.

She also repeated the questionable and unsubstantiated claim of savings and crowed about how, to date, the Medicaid budget was in balance after in previous years it often not being so. Yet that’s a red herring: the question is not whether the budget is balanced, but whether it was too big to begin with, wasting money on a program where other approaches, even doing nothing, would have produced at least as good outcomes for fewer taxpayer dollars spent. For example, a reason much more may be spent than necessary is that the “crowd out” phenomenon – people leaving and/or employers dropping employee access to private insurance to enroll in Medicaid – puts people on government rolls previously insured. Experts believe that constitutes between 40-50 percent of new enrollees in expansion (the Jindal report estimated 50 percent) – needlessly driving up taxpayer costs if the goal was to insure the uninsured.

In the final analysis, Gee’s effort reflects the burgeoning lack of transparency coming from Health under Edwards necessary when putting ideological goals ahead of what’s truly best both for the indigent and the taxpayer. In the face of incoming Republican control of the federal government by individuals rightly skeptical of Medicaid expansion promising major changes to it if not its elimination, this approach likely cannot last.

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