Election season lies just keep coming from Democrat Gov. John Bel Edwards about Medicaid expansion.
Edwards has held up expansion as a major accomplishment of his tenure, despite flimsy arguments in its favor. Throughout his reelection campaign he has touted how it brought insurance to many who didn’t have it and attributed care received under it as care that otherwise never would have occurred. In fact, as many as nearly half of all expansion enrollees already had privately-paid insurance and the remainder had access to care at the state’s charity hospitals. (And in any event, the health benefits allegedly conveyed by expansion are wildly overblown.) Further, about a tenth of enrollees at the peak have so far been found ineligible – largely because upon entering office Edwards’ Department of Health deliberately weakened verification standards – wasting $500 million a year in inappropriate payments.
That fact alone falsifies the idea that expansion “saved” money – an argument that almost made sense in 2016 when the federal government paid for all but several million dollars in administrative costs. But the tens of millions of state dollars wasted through inappropriate payments cancels any economic benefits from rerouting tax dollars from other states to pump through Louisiana (while Louisianans also see their federal tax dollars going elsewhere to pay for other states’ expansions) – even as an Edwards Administration-financed report erroneously inflated claims of economic benefits and left out other important data that left it almost useless to understanding expansion’s economic impact.
However, the crux of the “savings” argument rested on behind-the-scenes tax increases on health insurance policies and on care received in most state hospitals to finance the state’s share of expansion. Using data supplied by LDH a couple of years ago, I calculated a figure of around $225 million a year siphoned from the Louisiana economy by these.
Turns out I undershot. A recent report by the Legislative Auditor put the first year’s figure for the premium tax alone attributable to expansion at $314 million (which includes not only the increase paid on policies held by individuals and families but also state taxpayers’ portion of the policies doled out to expansion enrollees – which will become 10 percent of the total cost starting in 2020). This means (using FY 2018 data which actually serves as a good proxy for recent expenditures given changes in health insurance premium rates and in the number of enrollees) that this tax increase alone will about offset the $307 million or so extra Louisiana taxpayers will fork over to pay for policies that people used to pay for privately or who received free care through charity hospitals.
Perhaps aware of these flaws, Edwards recently has de-emphasized these arguments in favor of another – that expansion has kept open rural hospitals, going so far as to claim that “not a single hospital has closed in Louisiana, unlike other Southern states that didn’t expand.” Keep in mind that expansion for many states came into effect in 2014, while Louisiana picked it up in the middle of 2016.
At best, that statement made days ago reflects ignorance; at worst, it was a deliberate lie. On Oct. 19, Leesville’s Doctor’s Hospital at Deer Creek shut its doors. And it ignores that four Kentucky hospitals and one in Arkansas, both expansion states out of the box, closed in this time period. Edwards oversimplifies the issue of rural hospitals, where the most important consideration in keeping these open is attracting and keeping physicians – which policies promoted by Edwards have made more difficult to do, such as increasing taxes, trying to reverse educations reforms, high vehicle insurance rates from lack of tort reform that he opposes, and so on.
Of course, Edwards adds this to his packet of lies about expansion as a crude attempt to woo rural voters, who largely shunned him in the general election. Yet the one inconvenient truth he won’t admit, as his Republican opponent Eddie Rispone pointed out, is that Medicaid spending in Louisiana is unsustainable at its current rate (despite the best efforts of LDH to stall and delay in releasing forecasts about it). Voters should disqualify from office any candidate like Edwards who ignores this fact.