Why I changed my mind about Medicaid expansion
Published 2:46 p.m. Thursday
By Phil Berger
For more than 10 years I was one of the staunchest opponents to expanding Medicaid in North Carolina. The Affordable Care Act as enacted was and is bad federal policy and has done much to exacerbate problems in healthcare. However, given how our federal and state systems currently operate, our ability at the state level to alter policies at the federal level is severely limited.
I generally articulated three policy reasons for my opposition to Medicaid expansion:
- The cost of expansion could potentially bust our state’s financial stability.
- Our traditional Medicaid system was broken and could not handle hundreds of thousands of new expansion enrollees.
- For the people in the expansion population, a new government benefit would eliminate the incentive to work.
All these reasons fall upon current examination.
Since it was enacted, every attempt in Congress and by the courts to reverse the ACA and Medicaid expansion has failed. When Donald Trump was president and Republicans controlled Congress, they did not repeal or significantly alter the ACA. It’s not going away, and refusing to accept that reality hurts North Carolinians and the state’s finances. Medicaid expansion if implemented in a reasonable, responsible manner is a positive for state fiscal and healthcare policy.
The Senate version of House Bill 76, “Access to Healthcare Options,” is just that — a reasonable, fiscally sound approach to expanding access to healthcare.
First, this plan does not bust our state’s budget. In fact, just the opposite is true.
The federal government pays outright 90% of the cost and instead of the state ponying up the 10% non-federal share, hospitals pay that through a new assessment. Our state’s hospitals will receive a new infusion of more than $3 billion, and even with the new assessment, expansion is a net positive for the hospitals. The bill provides that if at any point the assessment does not cover the 10%, the state will end the expanded coverage.
Second, since winning the majority, Republicans in the General Assembly have reformed the state’s Medicaid program. What once was a broken, mismanaged, and fraud-prone system has become a solvent, well-managed program. That is in no small part because we moved Medicaid from a fee-for-service model to a managed-care model, which provides better budget predictability.
Lastly, the majority of adults that would be covered under expansion are already part of the workforce. These are working individuals who make too much to qualify for traditional Medicaid, do not qualify for exchange subsides, and can’t afford to buy health insurance on their own because of the perverted, and I believe, intentional design of the ACA. These working North Carolina citizens are caught between a rock and a hard place.
By expanding Medicaid now — on our own terms — we increase access to healthcare in a thoughtful, conservative way. We pass a plan that is good for North Carolina, and we take advantage of holding out for the past decade and secure a significant stimulus that avoids the financial hit the state would have taken years ago.
But we can’t just expand Medicaid and call it a day. We must address the very real consequences of additional people on our Medicaid rolls.
One recent healthcare study found that across the 50 states and Washington, D.C., North Carolina ranked 49th in cost, 43rd in access, and 35th in outcomes.
North Carolina voters feel that strain every day. That’s why 73% of North Carolinians — and 73% of rural North Carolinians — support Medicaid expansion. Republican voters also support expansion to the tune of 55% of all Republicans and 57% of Trump supporters.
We must find ways to drive down costs and increase the supply side of the healthcare equation. One way to do that is repealing and reforming North Carolina’s antiquated Certificate of Need laws. Certificate of Need laws prevent competition, protect existing monopolies, and drive-up costs.
Instead of allowing the market to operate and enable where and when healthcare facilities can open or expand, these laws enable competitors and state government blocking new facilities from opening and competing with existing facilities.
The Senate version of H.B. 76 includes the most robust Certificate of Need reform package in our state’s history. The changes address the biggest impediments to the availability of healthcare and the regulations that drive up costs for all North Carolinians. These changes will make North Carolina more attractive for providers, healthcare facilities, and hospitals willing to do business and compete here.
On balance, this is a huge positive for North Carolina. It will increase the number of North Carolinians who have insurance, assert downward pressure on healthcare costs for those who have insurance by reducing the incidence of the cost of uncompensated care being passed along to those that pay, and increase the supply of healthcare providers and facilities.
This healthcare access package is fiscally responsible, improves our state’s finances, and takes direct aim at regulations that drive up costs and prevent North Carolinians from receiving care.