A Sept. 6 editorial in this newspaper suggested that Maine will soon be missing out on “big checks” from the federal government to pay for health insurance in Maine.
The piece took Gov. Paul LePage and many Republicans in the Legislature to task for not agreeing to expand MaineCare (Maine’s version of Medicaid) to an additional 70,000 Mainers by taking federal dollars to pay for the expansion. For now, we’ll put aside the fact that in addition to paying state taxes, we also pay federal taxes which would be the source of this “free money.”
The editorial ends by stating that had Maine agreed to the expansion, we would be receiving $256 million in federal dollars annually, which is more than the sum the state paid recently to reimburse Maine’s hospitals for years of accumulated debt.
It’s an ironic point considering runaway expansion of Medicaid is the reason why Maine racked up so much debt with the hospitals in the first place. Now we’re contemplating a similar expansion on steroids.
In the first decade of this century, Maine expanded taxpayer-funded health care (Medicaid) to an unsustainable rate. It grew 78 percent between 2002 and 2009, while the population only increased by 7 percent. Maine’s spending on its Medicaid program is more than 30 percent higher than the national average.
We would be remiss if we did not mention that the last expansion currently costs Maine $175 million a year in general fund dollars. In addition, the federal reimbursement for MaineCare for a $2.5 billion budget was at a rate just under 75 percent in 2010. As of October 2013, that rate declines to 61.55 percent. That means that Maine taxpayers must fund an additional $320 million annually for the same level of programming.
In short, we have already expanded Medicaid while other states haven’t, and have paid dearly for it as evidenced by years of never-ending supplemental budgets needed to cover budget shortfalls created by cost overruns in Medicaid spending that continue to grow and cannibalize our state budget.
While it is true that many states have recently signed up to take federal dollars for Medicaid expansion under the Affordable Care Act (ObamaCare), they will still be lagging behind Maine’s previous expansions resulting in our current and expensive level of government-paid health care.
The Medicaid expansion proposal has been sold to us with the promise of Maine receiving 100 percent funding for it from the federal government. But a closer examination reveals this is not a good deal for Maine. While the first three years of the expansion would be “free,” the federal reimbursement rate would drop to 90 percent after that.
The Department of Health and Human Services estimates Maine would then have to start contributing 75 million additional dollars to Medicaid every year. That means we would have to ask Maine taxpayers to contribute an additional $150 million in every two-year budget going forward. That’s $150 million less we would have for education, public safety and other vital state programs.
And it turns out, the short-term costs during that “free money” period aren’t so free, after all. Maine would have to kick in $10.5 million annually during those first three years for administrative costs of covering the additional 70,000 Mainers.
In addition to creating endless debt, Medicaid expansion in Maine has had another unintended consequence over the past 10 years: it has provided an incentive for those able-bodied individuals who were paying for their own health insurance to join the welfare rolls at our expense. After all, why pay for something when you can get it for (here comes that word again) free?
So, contrary to what this newspaper editorial states, Maine does not stand to benefit from the “big checks” coming from the federal government. Those big checks come with a price that we simply cannot afford.
Sen. Jim Hamper and Reps. Richard Malaby, Deb Sanderson and Heather Sirocki serve on the Health and Human Services Committee.