Wednesday, December 12th, 2012
Senator Roger Bedford's Thoughts on Expanding Medicaid
As the holidays are upon us, most people choose to celebrate the true reason for the season through performing acts of generosity for their fellow man and showing compassion to their neighbor. But, even with all of the kindness in the air, there are others that take the “bah humbug” approach to the season—which is exactly what happened when Governor Bentley announced that the expansion of Medicaid will be denied to hundreds of thousands of Alabamians. I hope that Governor Bentley will take the time to reexamine this issue by looking to the past, the present and the future, just like Scrooge, and he will realize for so many reasons that the State of Alabama simply cannot afford to turn down the expansion of Medicaid.
Governor Bentley’s argument that “the state cannot afford to expand Medicaid” is the same exact argument that former Republican Governor Fob James and Governor Bob Riley made against the creation and expansion of children’s health insurance in Alabama. Despite those arguments, Democrats, who were in the majority in the past, were able to see the big picture and create one of the most successful—and cost-effective—health insurance programs for children in the country.
The bad news today is that Democrats are no longer in a position to override these objections and expand Medicaid. However, the good news is that Governor Bentley and the Republican supermajority still have time to change their minds and expand Medicaid to improve the health of our citizens and an infusion of economic activity in our state.
Medicaid must be expanded because Alabamians desperately need access to health care. The expansion would enroll over 350,000 Alabamians in Medicaid. Today, Alabama ranks fourth in diabetes diagnosis, has the second lowest life expectancy, is second in heart disease related deaths and has the third highest infant mortality rate in the nation. Expanding Medicaid would change these statistics and, more importantly, save lives.
The cost of expanding Medicaid to the state of Alabama is diminutive compared to the amount of money that the state would receive in federal matching dollars. A recent study by the Kaiser Foundation estimates that, minus the estimated savings in uncompensated care, the state would pay $569 million over ten years to expand Medicaid. For that estimated cost—the state would receive over $14 billion dollars from the federal government in matching dollars during the same period of time. In addition, the federal government would pay for 100 % of the Medicaid expansion during the first three years and gradually decreasing that down to pay 90 cents on the dollar after ten years. No rational investor would turn down these types of returns.
The economic benefits of infusing $14 billion dollars into the state’s economy are endless. As UAB noted in their recent study, Medicaid expansion will generate $20 billion in economic activity, which will add $1.7 billion in tax revenue to Alabama coffers from 2014 to 2020. Doctors, pediatricians, dentists, and pharmacists would have 350,000 new customers, which is a tremendous economic engine for our economy. These federal dollars and new patients would translate into the creation of new jobs and increased tax revenue for the state. In addition, many uninsured, working Alabamians would gain health coverage, which generates a healthier, more productive work force and economy.
The taxpayers, hospitals and doctors, who currently bear the cost for treating those who cannot afford health insurance, would be provided some relief should Medicaid be expanded. According to the Kaiser Foundation, the State of Alabama will save $512 million in uncompensated care costs, and payments to hospitals would increase by $2.7 billion over ten years. In addition, the state will realize an untold amount of savings because we can all agree that having access to preventative care proves to be much more cost-effective than the uninsured showing up in the emergency room needing acute care.
Finally, if Medicaid is not expanded, nearly 228,000 people in Alabama, who live below 100% of the federal poverty line, will not qualify for Medicaid and will not qualify for subsidies to purchase health insurance through an exchange. Due to the way the law is written, literally, the poorest, uninsured adults in Alabama will be those very individuals who will be left with less and will not benefit from the new healthcare law.Again, the cost of expansion to the state of Alabama is modest compared to the net gains that we stand to earn. This is especially true with Medicaid expansion costing the state zero dollars for the first three years. Because Governor Bentley is a doctor, he should understand, more than anyone else, what we will lose if we do not expand Medicaid. Therefore, I pray that the Governor will take the time during this season of reflection and compassion to reconsider his decision that will leave approximately 228,000 Alabamians without health coverage and force the state of Alabama to lose out on billions of dollarsin revenue.
If you feel as I do, please call Governor Bentley at 334-242-7100 to show your support for expanding Medicaid.