Why You Should Worry About Corbett’s Medicaid Rejection

After months of dodging questions with regard to the Patient Protection and Affordable Care Act’s Medicaid expansion — which would add about 500,000 Pennsylvanians onto the state Medicaid health care program for the poor — Gov. Corbett finally announced his decision in his 2013-2014 budget address yesterday. The answer: a big, fat no.

“Washington needs to stop treating Medicaid as a one-size-fits-all mandate and start granting states true flexibility to successfully reform and build a system that works for them,” Corbett said. “I want to be clear, I firmly believe we can serve more of our citizens in Pennsylvania, but only if we are given the independence and flexibility to do so. … As Governor, I will continue to work toward policies that will provide Pennsylvanians greater access to quality care and coverage.”

He noted that he wrote a letter to U.S. Health and Human Services Secretary Kathleen Sebelius, saying, “At this time, without serious reforms, it would be financially unsustainable for Pennsylvania taxpayers, and I cannot recommend a dramatic Medicaid expansion.”

The fact that Corbett, a budget-slashing privatization carnoisseur, rejected the option to expand Medicaid in Pennsylvania isn’t a shock. Except it also sort of is. Especially since he’s billed himself as a business-oriented politician. And his rejection will likely put a serious crimp in Pennsylvania hospitals’ business.

As we’ve explained before, the Medicaid expansion would open up the government health care program to individuals who make as “much” as $15,302 per year and, for a family of four, $31,155 per year. We know, that’s not a lot of money, but it beats the current Medicaid maximum of about $11,000 per year. The federal government plans to fund this coverage expansion by cutting the Disproportionate Share Payments (DSH) for hospitals, which is the money the federal government uses to compensate hospitals when they provide emergency care for patients without health insurance—which they do, because as former President George Bush once said, “You can just go to the emergency room!”

Pennsylvania has been receiving about $500 million dollars per year in DSH payments ($561,847,754 in Fiscal Year 2011, alone, according to the State Health Access Assistance Center), and now it will receive nothing. Problem is, with Corbett rejecting the Medicaid expansion, many of those who have been going to the emergency room without health insurance will continue not to have it—but the hospitals won’t get compensated for those services anymore.

“I’m very disappointed,” says state Sen. Vincent Hughes (D-Philadelphia). “It’s a huge missed opportunity. Pennsylvania, now, we’ve blown the largest infusion of new money into the state’s economy in years.”

On January 24, Sen. Hughes hosted a roundtable forum in Philadelphia City Hall, in which it was noted that the Medicaid expansion would infuse about $4 billion into Pennsylvania’s annual budget each year—and create an estimated 285 thousand jobs over the next decade. “He could have taken the savings plus the growth numbers and use it to do some other creative things in his budget to respond, truly, to where the people are in Pennsylvania. But he’s going in a different direction, and I’m very disappointed by it.”

Still, Hughes notes he will continue to attempt to convince Corbett to reverse that decision, and will be in touch with Secretary Sebelius. Five GOP governors have accepted the expansion, so far.

Americans For Prosperity of Pennsylvania, a Koch Brothers-funded libertarian group, approved of the decision. “I applaud the governor’s decision to join the list of states choosing not to expand the Medicaid program,” said Jennifer Stefano, the group’s state director. “I call on our state legislators to do the same. Those enrolled in Medicaid have worse health outcomes than patients that have no health insurance at all.”

The governor did not offer a plan to make up this money, other than to call us the “hardest-working people in the world” — perhaps implying, therefore, that we will all find awesome jobs and get health insurance through our work? It’s hard to tell. Expanding Medicaid may not be the best option in the world, but the effects of doing nothing sound a whole lot worse.

One Response to “ Why You Should Worry About Corbett’s Medicaid Rejection ”

  1. Elmer Money says:

    Options with the Exchange Program: States can operate their own, partner with the feds to operate, or let the feds do it…The success of state involvement in the exchanges is not how many are operating them in 2014, but how many are operating them after 2017. *Initial open enrollment begins 10/01/2013 for coverage beginning 01/01/2014 -
    http://www.chpfs.org/chpfs/attachments/article/25/Friday%20Plenary%204%20-%20Implications%20of%20Elections%20for%20Health%20Centers.pdf

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