EDITORIALS

Taxpayers foot the bill for LePage manifesto on Medicaid expansion

Maine Gov. Paul LePage appeared with Pennsylvania Gov. Tom Corbett at a U.S. Chamber of Commerce summit in April 2013. Gary Alexander, the consultant hired by LePage to analyze Maine’s Medicaid and welfare programs, stepped down as Corbett’s welfare chief in February 2013.
David Bohrer | U.S. Chamber of Commerce
Maine Gov. Paul LePage appeared with Pennsylvania Gov. Tom Corbett at a U.S. Chamber of Commerce summit in April 2013. Gary Alexander, the consultant hired by LePage to analyze Maine’s Medicaid and welfare programs, stepped down as Corbett’s welfare chief in February 2013.
Posted Jan. 14, 2014, at 10:01 a.m.
Gary Alexander
A. Jay Higgins | MPBN
Gary Alexander

Gov. Paul LePage’s administration has orchestrated a purely political move disguised as impartial analysis in advance of Wednesday’s public hearing on a bill that would sign Maine up for an expansion of Medicaid under the federal Affordable Care Act.

Now, when a proponent discusses the merits of expanding coverage to about 75,000 low-income parents and adults without children, LePage and his allies have an easy, one-number retort: $807 million.

That’s the cost of expansion ascribed to state coffers over the next decade by the Alexander Group, the LePage administration’s hand-picked consultant hired to conduct a $925,000, multipart analysis of the state’s Medicaid and public welfare programs.

The Maine Department of Health and Human Services last week released the first installment of the Alexander Group’s work, a feasibility study on Medicaid expansion. Unsurprisingly for a consultant hired by expansion opponent LePage, the Alexander report essentially concludes the cost of expansion isn’t one Maine’s state budget can handle.

“The more pressing needs are restructuring and streamlining to make MaineCare more efficient and to deliver better quality outcomes,” the report reads. “While health care access and improved health outcomes remain an imperative, expansion of Medicaid may not be the best policy choice to achieve those goals.”

A Maine-specific, cost-benefit analysis that is honest and comprehensive would be a valuable addition to the Medicaid expansion debate. Unfortunately, that’s not what the Alexander Group brings to the discussion.

The document reads as a political manifesto that methodically explains each talking point Medicaid expansion opponents have used over the past year to refute calls to extend coverage. In some spots, the report goes beyond the scope of evaluating Medicaid expansion’s costs to make policy judgments on education, public safety and corrections.

At the same time, the Alexander Group claims it’s “beyond the scope of this study” to analyze the economic effect of expanding Medicaid and to make recommendations on a “political decision” over whether the state should opt to continue receiving a type of federal funding meant to help hospitals offset the cost of uncompensated care.

One clear message is that Maine’s Medicaid program is bound to grow regardless of the state’s decision on expansion. The report projects a basically uninterrupted 31 percent increase in Maine’s poverty rate over the next decade that no expert is predicting. With more people falling into poverty, eligibility for Medicaid — expanded or not — would rise, inevitably increasing costs to both the state and federal government.

But even assuming the drastic rise in poverty, Alexander doesn’t appear to consider the fact that the federal government chips in a greater percentage of Medicaid costs for states with low personal income. While these concerns don’t entirely negate the report’s predictions that Medicaid expansion will cost the state, they raise questions about the $807 million figure.

This is a political document that makes the case for one LePage policy position, but the major poverty growth projected by the Alexander Group might get in the way of another point LePage wants to make as he runs for re-election — that Maine’s economy is turning around under his leadership.

The Alexander Group report also falls short in other areas that raise questions about its conclusions. For example, the report applies generic, national spending growth projections to Maine’s Medicaid program to make the case that Medicaid spending will continue to grow and subsume an ever-increasing portion of Maine’s state budget.

Under Commissioner Mary Mayhew, however, Maine’s Health and Human Services Department has begun a number of cost-saving initiatives for which the LePage administration is already claiming savings.

The Alexander document also apparently fails to consider potential savings to the state in the form of mental health services, substance abuse treatment and inmate health care for which Medicaid would start to cover costs as a result of the expansion. Right now, those services are completely state-funded for some residents who would be newly eligible for Medicaid under the expansion. In Michigan, this reality translated into major state budget savings.

Another omission? There’s no discussion of the benefits of expansion — not even a mention of how much federal funding Maine stands to receive by participating and the potential economic effect of the funds infusion.

The Alexander Group repeats its contention that Maine’s Medicaid program needs reform. We agree. But what mix of reforms does the Alexander Group recommend? That, of course, is the topic for another report — one that the LePage administration has already ordered from Alexander at a cost of $141,120.

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