Expanding Medicaid makes fiscal, moral sense

By The Des Moines Register


Gov. Terry Branstad has resisted an opportunity to provide thousands of Iowans health insurance through Medicaid. Snubbing this opportunity in the health reform law does not make fiscal or moral sense. The governor should rethink his opposition and agree to participate.

Earlier this year, the U.S. Supreme Court upheld the Affordable Care Act as constitutional but ruled that states have the option of expanding Medicaid to cover more residents. The governor’s knee-jerk response when the decision was announced: He doubted Iowa would do so. He said this without consulting Chuck Palmer, the director of the Iowa Department of Human Services, which oversees Medicaid.

Even as hospitals, physicians and businesses disagree with Branstad’s position, he has dug in his heels. That’s unfortunate because expanding Medicaid will save the state money.

Iowa would insure about 100,000 more people and spend about $30 million less per year if the state expands Medicaid, according to a November report by the respected Kaiser Family Foundation.

Why? Medicaid is jointly financed by the state and federal governments. For every dollar Iowa spends, the federal government provides about $2. But that rate increases dramatically for low-income adults who will be newly eligible for coverage under the health reform law. According to the Kaiser foundation, the federal government pays 100 percent for new enrollees for 2014-16 and at least 90 percent thereafter. The cost of administration is generally matched at 50 percent.

This higher matching rate is especially beneficial for Iowa, which has insured more people in recent years through special programs. Many of these people would be considered “newly enrolled” in Medicaid and would bring the higher federal matching rate if Iowa expands its Medicaid eligibility.

When it all shakes out, Iowa would see a 2.6 percent reduction in state spending on Medicaid, according to the Kaiser foundation report.

The question one year before the expansion would be available to Iowans is this: Will the governor change course?

Let’s hope so. The health and lives of more than 100,000 Iowans depend on it. These include low-income parents, the mentally ill and foster children who have aged out of the state’s foster care assistance program. The 100,000 Iowans include thousands of older people now using a Medicaid waiver. All these people and more can be covered under Medicaid beginning in 2014 if Iowa agrees.

This country has left millions of people uninsured for decades. This contributed to bankruptcies, lost productivity and early deaths. Iowa was among the states that cobbled together programs to get them help, sometimes straining the budgets of county governments and state agencies.

The American people demanded reform. In 2010 Washington delivered it. ObamaCare will insure 17 million more Americans through the existing Medicaid program. It raises taxes and generates revenue to help pay for it, and the federal government will pick up the majority of the expense for new enrollees. Iowa is one of eight states that would spend less on Medicaid under the expansion according to the study by the Kaiser foundation.

Branstad has not outlined a clear and affordable alternative to get Iowans covered. He says he’s concerned about federal spending, but he had no such concern when he asked for federal relief for farmers affected by the drought and when he pushed to keep an Air National Guard unit in Des Moines. His reservations are inconsistent with his experience and priorities.

Before his most recent election, the governor was president of a medical school. He has said he wants Iowa to be the “healthiest state in the nation.” He knows that health insurance is an important part of keeping people healthy.

It is easy for politicians to get caught up in political rhetoric. They sign a pledge or make a statement that backs them into a corner. Those with common sense and courage find a way to eventually do what is right.

Iowa’s governor should demonstrate that he is one of those leaders.


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