June 24, 2018
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Medicaid reruns: When will Maine government learn?

Mario Moretto | BDN
Mario Moretto | BDN
Rhode Island welfare consultant Gary Alexander presents his Medicaid expansion feasibility study on Tuesday to lawmakers on the Health and Human Services Committee, including (from left) Reps. Carol McElwee, R-Caribou, and Ann Dorney, D-Norridgewock, and Sens. James Hamper, R-Oxford, and Colleen Lachowicz, D-Waterville.


On Wednesday, a great number of people again squeezed into a public hearing room in the Cross State Office Building in Augusta to testify on a bill that would expand Medicaid to about 70,000 Maine residents under the Affordable Care Act. The stories and arguments were similar to last year, when the Legislature passed expansion by a majority but not quite the two-thirds needed to override Gov. Paul LePage’s veto.

Many of the questions asked about expansion were also similar. So let’s put some of them to rest:

Why can’t the uninsured simply buy health insurance off the marketplace and get a subsidy to help cover the cost?

It’s true that people who earn between 100 and 138 percent of the federal poverty level — who would be eligible for Medicaid if the state voted to expand — can qualify for subsidies on the health insurance marketplace.

But about 30,000 childless adults who make less than the poverty level will not be eligible for Medicaid or subsidies on the marketplace if Maine doesn’t expand. They fall into a coverage gap that would have been filled if the Supreme Court hadn’t ruled that states could opt out of Medicaid expansion. These are people who could arguably benefit from health care the most, but they won’t be able to afford it.

Those who earn between 100 and 138 percent of the poverty level are supposed to receive Medicaid, not buy private insurance, because health plans can be expensive for people living within reach of poverty, even with tax credits. In addition, total medical spending is significantly lower with Medicaid than with private insurance — and one goal of the ACA is to lower overall health care spending.

Lack of access to health insurance isn’t the same as lack of access to health care. Can’t the uninsured rely on other options such as NeedyMeds, Social Security disability benefits or the emergency room?

It’s clear that there’s no replacement for having health insurance. Other programs — to help cover the cost of prescription drugs or assist those with long-term disabilities — may be beneficial, but not everyone is eligible for them, and they certainly don’t provide access to comprehensive care.

Studies show, over and over, that the uninsured are less likely to receive preventive care and help for major health conditions and chronic illnesses. The consequences can be dire not just for their health but for those with private insurance, as the costs are passed on in the form of higher premiums.

Emergency rooms are required to see anyone who walks through the doors, but they are not required to eat the costs. They may try to collect from the uninsured, adding debt to a person’s health concerns. They may also shift the costs associated with uncompensated care to private insurers.

Isn’t Medicaid expansion too expensive for Maine?

Maine still doesn’t have specific, complete information about how much expansion would cost or save. But expansion under the ACA is certainly the best deal that’s ever been offered — with 100 percent federal funding for three years for newly eligible recipients, gradually dropping down to 90 percent thereafter.

The fiscal impact calculated for last year’s Medicaid expansion legislation considers only the effect on the state budget, so it’s not complete. It showed expansion would save the general fund $689,851 in fiscal year 2013-14 and $3.8 million each in 2014-15 and 2015-16. It would then cost $5.2 million in 2016-17. Meanwhile, the state would see an increase of $92 million in federal funds in 2013-14, $325 million in 2014-15, $341 million in 2015-16, and $349 million in 2016-17. These numbers don’t account for additional expected revenue.

A separate analysis from the Kaiser Family Foundation extrapolated national data. It projected that Maine would be one of 10 states to see the amount of state funds it spends on Medicaid actually drop over the next decade — by $570 million, or 3.8 percent — while the federal share of Medicaid expenses would rise by $3.1 billion, or 11.4 percent.

Finally, the new and controversial Alexander Group report commissioned by the LePage administration estimates expansion would cost the state $807 million over 10 years. The report, however, has extreme methodology flaws. For instance, it bases some of its projections off a dramatic rise in poverty that no one is expecting. It also does not 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.

Our position on the matter is clear: Expand Medicaid. But use the influx of federal funding and the momentum as an opportunity to reimagine how Medicaid is delivered. Ensure greater accountability. Improve quality. Measure the effects. Get a better handle on cost overruns. If the LePage administration had been working with the Legislature all this time on how to improve the system and expand Medicaid in the most cost-efficient way possible, rather than fighting largely ideological battles, it could have actually accomplished something. Instead, Maine gets reruns.

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