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The economics of Medicaid expansion and preventive health

Expanding Medicaid in Virginia shouldn’t be a partisan issue. There are some states where it isn’t; New Hampshire is a good example. In the granite state, the Republican state senate enthusiastically supported Medicaid expansion. With typical New England practicality, they supported it as a matter of common sense and good economics.


But, that’s not the case in the Commonwealth. The Democratic-controlled state senate has passed a private sector based expansion bill, and the Republican-controlled House has made it clear they want nothing to do with it. The issue, since it involves appropriations, has stalled the budget. The General Assembly will reconvene in a couple of weeks to try again. However, where the common ground be is hard to visualize at the moment. Both sides of the argument are dug in. The governor is pressing his case in favor of Medicaid from one end of Virginia to the other.  But, so far, the opponents of expansion haven’t shown any interest in negotiating.

Perhaps the biggest problem for Republicans is that they see support for this bill entirely in terms of their party’s vehement, indeed almost pathological objections to the Affordable Care Act. In their minds, support for expanding Medicare is a vote for the hated Obamacare. It’s true that Medicaid expansion was a part of the Obamacare legislative package, but that’s not really what this discussion’s about; or, at least, it shouldn’t be. Rather, it’s about expanding medical care to people who really need it. And what’s more, its expansion, in terms of basic economics, makes good sense.

But, first, who are these people? In Virginia, they number about 400,000, roughly 5% of the population, and for the most part, under the proposed legislation, are what are referred to as “the working poor”. Some work for themselves, contracting as laborers, handymen, or odd jobbers. Others are housekeepers or work part time. Often, they work in more than one job. They aren’t poor enough to qualify for Medicaid, at least as it currently stands, but also aren’t in a position to get regular health insurance. It’s a tough part of the economic ladder to live in.

So, why should we care about these people, and why should Virginia accept the federal government’s offer to fund up to 90% of a Medicaid expansion? Getting past the humanitarian arguments, which sadly don’t seem to carry any weight in this discussion, or the fact Virginia doesn’t have to pick up most of the bill, there is the economics. Most of these people, because they don’t have the money, never see a doctor unless it’s an emergency. This means that all sorts of conditions, most easily treatable in their early stages, such as high blood pressure and diabetes, have to each a critical stage. At this point, their care has become tremendously expensive and by default, ends up going on the public tab. As the result, a condition that could have been managed with a $50 a month prescription is instead replaced by massive medical bills.  

On top of that, many of these people, following what is usually a preventable medical crisis, can’t work. Their only option is to go on social security disability and then, finally, get Medicaid to treat what is now an expensive illness. The economics of this argument have long since been proven. But in the name of maintaining partisan cohesion in their opposition to Obamacare, Republicans in Virginia just aren’t interested in listening. Other legislatures have, at least 26 state assemblies so far, but in Virginia, we still can’t get past the politics.

—Reach David Kerr at This email address is being protected from spambots. You need JavaScript enabled to view it.

 

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