SADOW: Speaking Truth To Power On Medicaid Charade

Republican Rep. Ralph Abraham made a good start in his critique of Democrat Gov. John Bel Edwards’ expansion of Medicaid, but perhaps didn’t go far enough in explicating the mendacity and stupidity behind that ill-fated decision.

Last week Abraham, who faces off against Edwards for governor next month, held a news conference where he criticized Edwards for his decision to expand Medicaid and they way he did it. Abraham pointed out that the amount of state money going to it continues to increase rapidly, which Edwards refuses to acknowledge, and that Edwards has a history of lackadaisical attention to efficient management to root out waste identified by the Legislative Auditor as likely running into the hundreds of millions of dollars.

Abraham could have added that Edwards has tried to inflate Medicaid rolls intentionally. The incumbent planned all along to stuff as many people as possible onto Medicaid rolls and then use that freebie as a campaign talking point to buy reelection votes. He deliberately dismantled more stringent eligibility standards implemented late in his predecessor’s term that would have reduced fraudulent payouts. Only after the Auditor began scrutinizing the level of waste did the Department of Health expedite a new verification system into operation. Just the initial purge of ineligible enrollees lopped off around 6 percent of the total, which in fiscal year 2018 terms meant the state wasted $180 million.

And Edwards continues to fight better means of eligibility testing. This past legislative session he had the Democrat majority on the Senate Revenue and Fiscal Affairs Committee (keep in mind this in a Republican-dominated chamber) spike HB 72 by GOP state Rep. Tony Bacala that would have made clear in statute that the Department of Revenue must share information in establishing eligibility for state programs. The Legislative Auditor has sued the Edwards Administration, who alleges state law prohibits this despite an attorney general opinion to the contrary, for access to such records.

Keep in mind also that the latest propaganda effort alleging that expansion has economic benefits, through a skewed study footed by taxpayers, in fact shows the opposite. By next year, the state will be paying over $300 million annually more for something that supposedly generates tax revenues less than a third of that amount. Edwards has been dishonest all along in claiming expansion “saves” the state money, and won’t admit it will lose even more money in the future.

His rationale has been that a higher federal reimbursement rate on the expansion population applies to Medicaid recipients in other programs, so transferring them into it means the state pays less for the same services (although the same amount is spent, just that federal taxpayers in Louisiana and elsewhere pick up more). But what Edwards didn’t tell was that Louisiana voluntarily already was paying for health care that it didn’t have to for much of the new expansion population, which as a family earns at the 25 to 138 percent of the federal poverty limit.

That’s because of R.S. 46:6 which says the state’s (owned or operated) charity hospitals will serve for free anybody below the 200 percent FPL. In other words, “savings” came only because Louisiana already chose to add on something not required by federal law. “Savings” could have been realized simply by repealing that law.

To inflate “savings” claims even more, proponents argued that expansion presumably would drive down disproportionate share hospital payments, triggered when a Medicaid client doesn’t go through the regular managed care system but instead heads to an emergency room for treatment. Replacing that more expensive mode of treatment with primary care should save and drive down DSH payments.


Yet the report unwittingly burst that bubble as well, with its authors admitting that DSH payments actually rose since expansion took place. This has happened because expansion swelled Medicaid rolls by a third  yet the number of providers didn’t budge even though federal taxpayers chipped in more temporarily in reimbursement rates. When that ended in 2014, nationally physicians became even less likely to accept new Medicaid patients.

So, guess what? Medicaid clients flooded emergency rooms, replicating previous behavior and perpetuating the same inefficient system. This means the state double-paid: first with the premiums for the expansion population for services that many of its members didn’t use because, secondly, they used ER services instead. That’s something else Edwards won’t tell.

And, Edwards has laid down one more layer of deceit about Medicaid. His administration proudly floats statistics about how many doctor visits, diagnoses, etc. that the expansion population has experienced over the past year, implying that expansion allowed for this. But, in fact, many of these interventions would have occurred without expansion: at least a third of that clientele already had insurance before jettisoning in favor of taxpayers picking up their tab that has cost taxpayers hundreds of millions more.

If anything, Abraham pulled his punches: Edwards has obfuscated, if not lied about, the impact of Medicaid expansion in Louisiana. It isn’t any kind of triumph at all but nothing more than a smarmy vote purchase plan using the people’s money performed in a wasteful manner that delivers preventive health care no better than 30 minutes of exercise a day. Let’s hope Abraham and others keep speaking truth to power on this issue.



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