Cutting Back Now That They Have to Pay for It

(Image from Newsweek)

States controlled by progressives are cutting back medical care to undocumented immigrants: [bold added]

California Gov. Gavin Newsom has proposed freezing enrollment of undocumented adults into the state’s Medicaid program for the poor and disabled. Instead of receiving essentially free coverage, those already enrolled would be required to pay $100 monthly premiums starting in 2027. Newsom floated his proposal after the state program, Medi-Cal, went $6.2 billion over budget this year.

Illinois Gov. JB Pritzker recently signed off on a state budget that cut funding for health coverage of undocumented adults ages 42-64. Benefits will end for that group at the end of June. The program was initially expected to cost $112 million annually, but quickly ballooned to a projected $800 million a year that was “unsustainable,” a spokesman for Pritzker said.

Minnesota Gov. Tim Walz, the former Democratic vice presidential nominee, agreed to end a health insurance program for undocumented adults in a deal with state Republicans to pass a new budget this month.

And in Washington, D.C., Mayor Muriel Bowser has proposed phasing out coverage for undocumented people over the age of 21.

After ambitiously expanding health programs to undocumented adults during the pandemic, some states are grappling with far higher-than-expected costs and dwindling budget reserves that had been buoyed by federal dollars related to Covid-19....

Medicaid programs are funded by a mix of state and federal dollars. But states are barred by law from using federal funds to cover undocumented immigrants, placing the entire burden for covering them on states. And unlike the federal government, which often relies on deficit spending, states have to balance their budgets, leaving less wiggle room in tight economic times...

California expects its general fund spending on undocumented healthcare to be $10.8 billion in its next fiscal year, up nearly 50% from the governor’s original budget. About 1.7 million undocumented immigrants are covered under the program.

Some public opinion polls show shrinking support among Californians for covering undocumented immigrants amid the state’s budget crunch. A recent poll by the Public Policy Institute of California found that 58% of adults oppose providing the coverage, whereas majorities had supported the idea in surveys from 2015 to 2023.

When citizens are having difficulty paying for their own health care, there's no voting constituency that supports funding for non-citizens. With Congress under control of Republicans whose states do not pay for undocumented-immigrants' health care, progressive states can no longer look to Washington for help.

Elections have consequences.

Obamacare: Let the Situation Ripen

Yesterday I made the following statement about Obamacare: "government spending is rising much faster than originally projected while revenues are falling short."

These days one should not just throw out a statement like that without a link or two. Here is Investor's Business Daily, on the signs of collapse:

The Centers for Medicare and Medicaid Services reports that the number of insurers applying to participate in ObamaCare exchanges next year plunged by 38% compared with last year, and is half what it was in 2016.

CMS also reported that 40 counties in Indiana, Ohio and Nevada are at risk of having zero insurance companies in their ObamaCare exchanges next year. The Kaiser Family Foundation put the number of at-risk counties at 38.

In addition, CMS reported that 2.4 million enrollees in 40% of the nation's counties will have just one insurance company in their area.

The average increase in premiums next year for a Silver plan in eight states will be 18%, according to Avalere. One of the last ObamaCare insurers in Iowa has put in for a 43.5% hike. In Washington state, the average boost is 22%. In Tennessee, the proposed rate hikes range from 21% to 42%. And so on.

As we noted before in this space, these insurance defections and gargantuan rate hikes have nothing to do with the Republican's repeal effort, but with the continued deterioration of the ObamaCare markets.

States are also starting to struggle with the costs of ObamaCare's "free" Medicaid expansion. A report from the National Association of State Budget Offices said that the expansion will cost states nearly $9 billion next year, more than twice what it cost in 2016.

CMS reports that the per capita costs of the Medicaid expansion are 50% higher than expected.

Arkansas scaled back its Medicaid expansion in May, and Ohio lawmakers voted in June to freeze the expansion in that state. Oregon's Medicaid expansion contributed a $1.6 billion gap in the state's budget. In California, the Medicaid expansion will cost the state $1.3 billion this year, putting additional strain on the state's budget.

Today President Trump repeated his call to the Senate to continue working on a health care bill. It's my belief---hold on to your hats---that he thinks it's the right thing to do despite the fact (not a probability) that he and the Republicans will be vilified no matter what they come up with. As a person with life experience, he knows that trying to help people who don't wish to be helped not only is unappreciated but resented.

He should just call off his effort, declare Obamacare to be the law of the land until the people overwhelmingly want something different, agree to provide funding according to the 2009 CBO projections, and let the Obamacare advocates tell us how to fix it as long as they stay within the budgetary guidelines (plus 10% because he's a reasonable guy). Let the situation ripen, as the saying goes.

Coverage is Not Care

A few thoughts on the American Health Care Act (HR 1628, plus amendments) that was passed by the House last Thursday:

1) Senate Republicans are composing their own bill. Assuming it passes (a big if under the Senate's complex procedures), the House and Senate will have to reconcile their respective versions. There is zero chance that HR 1628 will be sent to President Trump in its present form. (As a matter of academic interest, see WSJ analysis if the House bill does become law.)

2) House Democrats mocked their Republican counterparts, suggesting that the latter would be thrown out of office in 2018 by the vote repealing supposedly popular Obamacare. Be careful, Dems, losers who believe they have no life after November, 2018 may ram the whole conservative agenda down your throats in the next 18 months.

3) House Republicans were divided over both how and how much to fund hard-to-insure people with pre-existing conditions, but the Senate Republicans' thorniest issue seems to be over Medicaid expansion.

20 million Americans gained health insurance after Obamacare was passed. Most were added under Medicaid. Politifact:

[Senator Rand] Paul said the vast majority of people that got insurance under Obamacare got it through Medicaid. About 20 million people gained coverage and about 14.5 million of those were under Medicaid or CHIP. But a sizeable fraction of that 14.5 million were eligible before the Affordable Care Act took effect. One estimate said about a quarter of them were previously eligible. Another estimate put it as high as half.

There is some guess work behind all the reports. Medicaid might account for slightly more than half of those who gained coverage. Most people wouldn’t say that amounts to the vast majority, but it is likely still the majority.

The numbers tell the story: if Obamacare is great coverage, then Medicaid (Medi-Cal in California), with more than half the Obamacare additions, must also be great. In 2012 the Mercury News detailed why many doctors do not accept Medi-Cal patients. In a 2015 follow-up editorial the Mercury News said the problem is getting worse:

But it’s becoming increasingly clear that the influx of 2.7 million Californians to the Medi-Cal roles [sic] is putting a strain on the state’s medical system....It’s not hard to discern why so many California doctors are loath to treat Medi-Cal patients. The paltry $16 reimbursement rate for a primary care visit makes it difficult for physicians to justify the appointment.

12 million Californians, about 30% of the population, are covered under Medi-Cal. They are putatively "covered," but are they getting health care?

Something's Got to Give

Governor Brown's administration "has been moving at full speed" to implement California's participation in the Medicaid (Medi-Cal) expansion that is part of the Patient Protection and Affordable Care Act, aka "Obamacare." The Supreme Court ruled that a state could stand pat in the current Medicaid program without having to expand it under Obamacare, and there is much agonizing among the governors about which way their states should go. In our overwhelmingly social democratic state, there was never any hesitation about California's participation.

Whether or not one supports Obamacare, practical considerations suggest that Medi-Cal is headed for a train wreck. Under the existing program Medi-Cal's low reimbursement rates have resulted in doctors refusing to take new Medi-Cal patients, and long waiting times occur frequently. A few doctor's tales, per the Mercury News:

When Dr. Jerold Kaplan made a home visit last year to a man with a foot wound, he billed Medi-Cal -- the state's health care program for the poor and disabled -- what he thought was a modest $90.

His payment: $8.96.

The Berkeley wound surgeon received a bit more for his home visit to a quadriplegic last year: $13.44. [snip]

Medi-Cal pays [Los Gatos ear, nose, and throat Dr. William] Lewis $15 to $20 for an office visit, compared with the $50 he gets from Medicare and $60 to $70 from a private insurer. The Medi-Cal rates are so low, Lewis said, he doesn't bother billing for it because it's not worth the hassle. He just eats the cost.

Lewis typically declines to see new Medi-Cal patients unless it is a follow-up visit with someone he treated in a hospital emergency room.

"You cannot run a practice seeing Medi-Cal patients," he said. "You can't pay your employees and pay for your overhead and keep your doors open."

One patient's story:

When San Mateo mom Macrina Mota's daughter injured her foot playing soccer last year, the two spent 13 hours in an emergency room to treat a sprained foot.

"They're just overbooked; they're overloaded," Mota said.

Medi-Cal already covers 7.7 million Californians, and an estimated 1.5 million are projected to be added under Obamacare. Reimbursement rates are being cut, doctors are leaving the system, and over a million patients are being added. In economic terms demand is up, supply is down, and the normal mechanism for increasing supply, i.e., price, is being kept low by government fiat.

It's not going to be pretty.