It turns out that the Republican-led General Assembly did give a substantial tax break to people other than the rich. The problem is that the relief went to people in other states.
A McClatchy Newspapers analysis shows that the legislature’s refusal to expand Medicaid means that North Carolina taxpayers could spend more than $10 billion by 2022 to provide medical care for low-income residents of other states. For its largess, North Carolina will get nothing.
Don Taylor, an associate professor of public policy at Duke University, says refusing the federal money results in “the redistribution of money from poorer states to richer ones, an outcome imposed by the poorer states upon themselves.”
It’s a breathtaking contrast. The penny-pinching legislature that couldn’t find a dime to give veteran teachers a raise is willing to let 10 billion North Carolina dollars flow to states that had the wisdom and compassion to provide health insurance to their working poor.
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This is being done, according to Republican legislative leaders, because North Carolina can’t afford the cost of more Medicaid even though the federal government promised to pay the expense of expansion for the first three years and at least 90 percent of the cost thereafter.
Cost of refusal
But the truth is the opposite. North Carolina can’t afford not to expand Medicaid to hundreds of thousands of low-income, uninsured people.
The analysis based on data gathered by the Urban Institute, a nonpartisan think tank, found that without expansion here the state will pay $10.2 billion in taxes that will support Medicaid expansion in the 27 states that have accepted the federal money. Meanwhile, if the state holds out until 2022, it will will forgo $39.6 billion in federal money for Medicaid expansion. The cost of the expansion to the state over that period would be $3.1 billion.
Gov. Pat McCrory has taken a different approach in explaining his opposition to expansion. He says the North Carolina Medicaid system is “broken” and expanding it would only expand the problems. But there’s little evidence of anything broken in Medicaid other than the computer boondoggles that McCrory’s administration caused by pressing a new payment system into use before it was ready. The delivery of Medicaid-supported services in North Carolina is relatively efficient compared with other states.
McCrory has made a good faith proposal to restructure Medicaid in a way supported by the state’s medical community, but Republican legislative leaders favor turning the program over to private managed care organizations. While the standoff continues, hundreds of thousands of North Carolinians go without Medicaid, the state’s hospitals struggle to cover the costs of indigent care and thousands of jobs that would have been created by expansion remain nonexistent.
In Republican-led states that are refusing to expand, a rational debate can’t be held because expansion opponents won’t be up front about their motives. They say they fear higher costs, but what they really fear is the success of the Affordable Care Act. They are opposed to “Obamacare” in all its forms, including Medicaid expansion, because they are opposed to President Obama and want his health care law to fail. Blocking expansion isn’t about costs. It’s about spite. But as the cost of refusal grows, that political petulance is exacting an intolerable price.
Slowly, hold-out states are agreeing that the cost is too high. They are re-fashioning their Medicaid programs in line with conservative principles and accepting the federal money to expand the program. When the legislature convenes in January, Medicaid reform will be high on the list of priorities. Let’s hope the new year brings a new attitude and that lawmakers will agree it’s time to take care of our own rather than send billions of tax dollars to help other states take care of theirs.