Here’s why the arguments against expanding Medicaid don’t work

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Gov. Walker was never going to take the Medicaid expansion under Obamacare because he is a Republican governor who wants to run for president, and although some Republican governors have taken the Medicaid expansion, none of the ones who want to run for president have. (Okay, one.)

In order to avoid seeming to be heartless and unconcerned about the hundreds of thousands of Wisconsinites who will not get health coverage as a result of his decision to run for president, Walker instead announced a complicated plan to kick a bunch of people off BadgerCare (our name for Medicaid) and onto Obamacare’s private health exchanges.

Now the state’s health care providers — hospitals, physicians and others — are calling on lawmakers to reverse course and take the Medicaid expansion for a year or two in order to avert a situation where Walker kicks a bunch of people off BadgerCare but the exchanges aren’t able to accommodate those people and they end up with no insurance at all.

There really haven’t been a lot of substantive arguments against taking the Medicaid expansion. Mostly there is “Obamacare = death of freedom,” which is not really an argument, and there is “presidential politics demand that Walker reject Medicaid,” which is not substantive.

So I genuinely appreciate that this blog post by James Wigderson at the MacIver Institute bothers to actually mount an argument against the calls for expansion by the Wisconsin Hospital Association and others. But I don’t find it very convincing.

Here’s Wigderson:

Under Obamacare, the federal government promises to fully fund an expansion of Medicaid for the first three years, and then 90 percent thereafter. In an interview with the Chicago Tribune, Congressman Paul Ryan, the chairman of the House budget committee, warned governors against relying upon higher levels of federal funding for Medicaid, “The fastest thing that’s going to go when we’re cutting spending in Washington is a 100 or 90 percent match rate for Medicaid. There’s no way. It doesn’t matter if Republicans are running Congress or Democrats are running Congress. There’s no way we’re going to keep those match rates like that.”

Now, obviously this is Paul Ryan’s view. Slashing discretionary spending on programs that benefit poor people is kind of Ryan’s thing!

But look, even if you accept the Walker/Ryan view that the Medicaid match will end up being cut by Congress, it is quite obviously false that it will be “the fastest thing that’s going to go.” Barack Obama is president through 2016 and he has a veto pen. That means there would be no actual risk to Wisconsin taxpayers to taking the Medicaid match on a short-term basis as the Wisconsin Hospital Association and others now suggest.

From there, a large part of Wigderson’s argument depends on eliding the difference between having the exchanges “ready by deadline” and “ready and functioning smoothly,” which is the concern expressed by the hospital people and also everyone else who thinks about this issue for a minute. The feds are very likely to have something ready by deadline! It’s the law! The whole issue here is the totally reasonable expectation that the first weeks of implementation are going to be a big mess with a bunch of people waiting on hold and not enough people to help them and so on.

After I posted something about this on Twitter in the afternoon, Wigderson wrote to me to say that he agreed that this was WHA’s argument but that he sees this as a design flaw with Obamacare rather than something that would ever possibly get ironed out in a year or two.

I think that’s wrong. Medicare Part D is as good a comparison as any. Implementation of the program was indeed a big mess and a cause of frustration for many seniors. But then those seniors eventually got enrolled and the complaints about the program were the actual design flaws like the doughnut hole. Meanwhile Medicare Part D is very popular. I think that’s pretty much how Obamacare will go: giant pain to get up and running, followed by public acceptance coupled with complaints about the actual design problems.

Here’s an example of one of those given by Wigderson:

The WHA and the other health care groups that sent the letter to the legislature are also expressing concern that the costs to the individual participating in the exchanges created by the Affordable Care Act may not be so affordable. In their letter to the legislature,

“These out of pocket costs could equate to as much as 20% of total income and could cause this vulnerable group to fall out of coverage and into the ranks of the uninsured.”

That’s not an implementation problem on the state level, that’s a design flaw in the federal program. Those projected costs are the result of the federally mandated coverage provided, and that is not going away after a transition period.

Maybe true! But note that Wigderson’s preferred way of dealing with this design flaw is to have Wisconsin lean into it and push the maximum number of people onto the flawed exchanges. Does that approach seem likely, to you, to solve the problem?

It is also Wigderson’s view that “once Wisconsin commits to the expansion of Medicaid spending beyond the governor’s plan it will be nearly impossible to roll back.” But why should that be true? For example, as he notes, BadgerCare enrollment was capped under Democratic Gov. Jim Doyle. Why is it impossible to imagine that future budget crunches might lead to future adjustments to BadgerCare exactly as the budget crunches in 2009 and 2011 did?

Here’s Wigderson:

A cynic might suggest that groups like WHA, an endorser of President Barack Obama’s Affordable Care Act, are actually trying a “backdoor” implementation of Obamacare in Wisconsin by expressing concerns over the timeliness of the creation of the federal health care exchange.

A cynic might! So might anyone who is paying attention. Of course this is exactly what is going on. WHA advocated full Medicaid expansion. This is a fallback plan and a bit of a Hail Mary given the politics.

But, James: Obamacare will be implemented in Wisconsin. No backdoor required; it’s the law and it’s happening. “Obamacare” is not just the Medicaid expansion. The exchanges are Obamacare too — which means the governor’s plan, too, is 100% dependent upon Obamacare. (There is a really bizarre incoherence to the Walker proposal, which states that Obamacare is so bad and doomed to fail that it is necessary for some reason to absolutely stretch and overburden a different part of Obamacare in order to save us from Obamacare.)

The question, in other words, is not Obamacare vs. no Obamacare. It is whether Wisconsin will choose a course that will pretty clearly make that implementation harder and more painful for poor Wisconsinites than it needs to be.

A cynic might suggest that Republicans would prefer a messy, painful Obamacare implementation, and that Walker’s plan is designed in such a way as to make it unlikely that insurance coverage is significantly expanded and also to ensure that any problems can be safely blamed on the feds.

But that won’t be true. Wisconsin will have chosen its path.

About Robert Mentzer

I am the opinion editor at Daily Herald Media.
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