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True Cost of Rejecting Medicaid Expansion/MAY 2019

Published on 5/15/2019

May 15, 2019

Last week’s Hot Topics gathering brought LWVOC members and guests up to speed on the consequences of Florida’s decision to reject the Affordable Care Act’s Medicaid expansion.

While the ACA’s Medicaid expansion was set to take effect in 2014, a 2012 Supreme Court ruling allowed states to opt out. Former Gov. Rick Scott declined Florida’s $5 billion annually in federal funding, which would have covered 800,000 Floridians (initially, the federal government covered 100 percent of the cost to states, leveling-out to 90 percent in 2020). Gov. Ron DeSantis is continuing that policy.

Moderator Paul Duncan, a noted healthcare researcher and Associate Dean at University of Florida’s Graduate School, kicked-off the panel with a brief overview of the U.S. healthcare system as well as ACA’s multi-pronged reforms.

At its core, he explained, the ACA had one simple goal: to reduce the number of uninsured (at the time, 50 million individuals) and thus reduce the cost of uncompensated care—which accounts for approximately 20 percent of every hospital bill. Elements of the ACA—such as subsidies, letting older adult children remain on family policies, and expanding Medicaid—were intended to work together to that end.

Essentially, Duncan explained, “[the ACA] was a very conservative effort to buttress the core principals of our existing system.” Now six years in, 37 states have expanded Medicaid programs, yet between 25-35 million individuals remain uninsured nationally.

Recently retired Director of the Florida Department of Health in Orange County Dr. Kevin Sherin shared stories of vulnerable populations in Florida, beginning with coverage for HIV.

Patients diagnosed with HIV are covered by Medicaid, yet those considered ‘at risk’ of acquiring HIV are not—so they’re unable to lower the risk of infection by taking the preventative medication PrEP. “Tens of billions of dollars in treating HIV could be saved by expanding PrEP” coverage, said Sherin. The Medicaid expansion also would have covered treatment for another highly infectious disease. “We would prevent the high cost of Hepatitis C, which is cirrhosis of the liver, liver failure, cancer of the liver, etcetera.”

Declining the expansion translated, in his view, into missed opportunities for prevention. “It’s cheaper to treat someone with high blood pressure than to take care of them in the hospital with a stroke. Period.”

Anne Packham, marketplace product director for the Affordable Care Act navigator grant, recounted two recent conversations with individuals who may have been covered by the expansion:

A divorced woman in her 30s with three children, working 30 hours a week at $12.57 per-hour receives no health insurance coverage at work. “Her salary is too much for her to qualify for Medicaid currently, yet too little to get help through the exchange,” Packham explains. “She’s absolutely caught in the middle.”

In another example, a 61-year-old woman received a pink slip after 21 years with a major Central Florida employer, losing her health insurance along with her job. She doesn’t qualify on the exchange because she made too much first part of year, and has been unable to get another job, perhaps due to ageism.

“So, she’s now just hoping she can make it another four years [to Medicare age] without insurance, because she can’t afford the full cost premiums on the exchange.”

Marni Stahlman, ABD, executive director of the Conductive Education Center of Orlando and former President/CEO of Shepherd’s Hope, emphasized the economic impact of uncompensated care on the rising cost of employer-provided coverage.

“At some point, the system is going to equal itself out one way or the other,” she explained, in the form of higher employee contributions, higher deductibles and co-pays, and limited medication options. “It’s all being passed [through]. People who have taken for granted that they could get health benefits from their employers are now taking on the brunt of that—as well as the uninsured.”

During the Q&A period, panelists pointed out additional consequences of rejecting the expansion, including the limited network of Medicaid providers and insurers. “Even providers who accept Medicaid patients may not always have cooperation from healthcare systems,” Sherin noted.

Stahlman stressed the importance of this issue to Central Florida, where “a large pool of employees is responsible for a thriving tourism economy and yet we’re 47th out of 50 largest cities in paying [those employees].”

Packham and Stahlman both expressed limited optimism for Florida’s expanding the program going forward, especially given the legislature’s attempt to limit voters’ ability to add issues to the ballot.

Sherin, however, offered hope, noting that red states such as Maine and Louisiana have expanded Medicaid coverage. Those states will one day examine their bottom lines, he explained, so holdout states like Florida will at last recognize it’s “financially irresponsible” not to expand.