WATERS: Obamacare Bandwagon Over Fiscal Cliff

Jumping on Obamacare’s Medicaid Bandwagon While Tumbling Over the Fiscal Cliff - By Jim Waters

While the constitutionality of Gov. Steve Beshear’s decision to heave Kentucky onto Obamacare’s Medicaid wagon – the one that rolled through the hills of the Bluegrass State last May - is being challenged in court, there also are plenty of concerns about whether adding hundreds of thousands of Kentuckians to the government health-care dole is worth the cost.

New information about the burden states that bite into Obamacare’s apple will add to the nation’s deficit offers even more doubt that Beshear’s plan to make Kentucky’s broken Medicaid system bigger - rather than better - is sound policy.

The Kaiser Family Foundation’s analysis of recent Congressional Budget Office figures indicates that if all 50 states acquiesce to Obamacare’s Medicaid expansion, it will add $952 billion to the federal deficit by 2022.

If both the court challenge and legislative efforts fail to stop Beshear’s train, Kentucky alone will be responsible for increasing the nation’s deficit by nearly $19 billion by 2022. Add in the deficits that would be created if the six surrounding states that have yet to jump on Obamacare’s Medicaid train and this region of the country alone would add more than $167 billion to the federal deficit by the same year.

Such exorbitant spending might be more justified if government programs actually made people healthier. Alas, the evidence just isn’t there.

In fact, supporters of the federal Medicaid expansion in Kentucky unknowingly illustrate this point vividly.

When Beshear announced his plans to expand Medicaid in the commonwealth, he made a big deal of the fact that Kentucky is one of the nation’s least healthy states.

There’s no denying that fact here. Kentucky has the nation’s highest smoking rates and cancer deaths, the third-highest number of heart attacks and is among the nation’s top-10 in diabetes and several other unfavorable categories.

No doubt exists about the severity of the malady. It’s the cure that’s more-than-questionable.

Beshear has couched his enthusiasm for getting more federal dollars in grand statements about how Obamacare will bring about a Messianic-like deliverance for Kentucky’s sick.

Yet if the salvation of the ill health of our state’s lower-income residents comes through increased spending on government programs, then the commonwealth should already be much healthier than it is.

Total federal and state spending on Medicaid has risen nearly 60 percent during the past 14 years – from $3.3 billion in 1999 to nearly $6 billion currently. Kentucky, which currently is responsible for around 30 percent of those Medicaid costs, now takes $1.5 billion per year for Medicaid out of its General Fund for the program – nearly double the $802 million spent in 1999.

When Beshear announced his plans to expand the commonwealth’s Medicaid program, which could add as many as 308,000 patients to the plan, he declared that it was “the single most important decision of our lifetime for improving the health of Kentuckians.”

After doing “the exhaustive research,” Beshear said his policy would “provide better access to health care for our people.”

Here’s a question that Beshear needs to answer before committing the health and wallets of Kentuckians to expanding the size of Medicaid rather than reforming it: How will simply expanding this program - which has been around since the 1960s and which, despite significant spending increases, has failed to slow heart-attack and cancer-death rates - improve the health of our state?

In a Bluegrass Institute report analyzing the likely impact of expanding Medicaid rolls in the commonwealth, University of Kentucky economist John Garen also concluded the research simply does not support the idea that just spending more money to expand the program will improve Kentuckians’ health.

Add in the inevitable downgrade in the nation’s deficit condition, and it seems Obamacare’s Medicaid wagon has already crashed.

Jim Waters is president of the Bluegrass Institute, Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.