Monday, January 28, 2013

Setting the Record Straight on Governor Brewer's Medicaid Plan

On Thursday, you may have seen the Goldwater Institute’s take on Governor Brewer’s Medicaid Plan.

Respectfully, GI’s analysis ( was lacking in some areas.

Please see our line-by-line, italicized response below.

Matthew Benson
Director of Communications

Office of Arizona Governor Janice K. Brewer

Expanded Medicaid, Shrinking Wallets
By Byron Schlomach

The federal health care law included a provision asking all states to expand their Medicaid programs to cover all adults and children up to 133% of the federal poverty level. Right now, a little less than a fifth of the state’s population is given free healthcare through Medicaid; if the state expands Medicaid nearly a fourth of Arizona’s population would be covered.

Misleading. The expansion represents a minor change to Arizona’s Medicaid eligibility, adding about 57,000 individuals above the level already mandated by Arizona voters. Even with this expansion, the Medicaid population will still be less than one-fifth of Arizona’s population. Numbers aside, the bigger issue is whether we accept the current dynamic in which so many of our fellow Arizonans have no health insurance, receive Emergency Room care when they’re sick or injured, and see their exorbitant costs offloaded onto the rest of us. This Hidden Health Care Tax amounts to nearly $2,000 per year for every Arizona family.

This expansion would cost a lot of money we don’t have. Even with the federal government picking up most of the tab, estimates put the cost of expansion for Arizona at $125 million in 2016 alone. The yearly cost would rise as the federal share of the cost ratchets down to 90 percent. As the federal government’s financial condition worsens, states will likely have to pick up even more of the cost.

False. The Governor’s Medicaid Plan will employ hospitals to leverage federal dollars – guaranteeing there is NO COST to the State of Arizona General Fund. More than 30 states already use a similar mechanism to draw down federal Medicaid funds. Perhaps best of all: Governor Brewer’s proposal will help alleviate Medicaid pressure on the General Fund, protecting critical state services such as education and public safety.

Governor Brewer wants a “circuit breaker” that will turn off the expanded program if the federal share ever fell below 80 percent. While the Supreme Court said states can’t be compelled to expand Medicaid, it’s an open question whether they can be compelled to continue an expansion once agreed to.

False. In a Dec. 10, 2012, letter to governors, HHS Secretary Kathleen Sebelius made it clear that states can choose whether and when to expand their Medicaid programs. And the letter clearly says any state may cancel its expansion at any time without endangering its remaining Medicaid funding. (see Question 25 -

If, in the future, the federal government insists that we keep expanded Medicaid coverage as a condition of keeping any Medicaid funds, we cannot count on our own state leaders to challenge that in court.

Misleading. Governor Brewer and other state leaders were united in challenging the Affordable Care Act all the way to the U.S. Supreme Court. Similarly, the Governor and legislative leaders would be willing to go to court once more in order to defend the authority of Arizona’s elected officials to make financial decisions in the best interest of the State – just as they’ve done on other occasions.

After all, the Obama administration takes the position that Obamacare’s expanded coverage of children is a valid mandate, in clear contradiction to the Supreme Court’s decision. Still, state policymakers are doing nothing to challenge this position.

False. The Supreme Court’s ruling did not change other Medicaid rules, and only made the expansion of low-income adults optional. Medicaid rules make it clear that the federal government CAN increase the minimum eligibility levels for mandatory populations, such as children.

But there’s more at stake than dollars and cents. Expanding Medicaid means the state will participate in enforcing the health insurance mandate. After all, everybody is required to have health insurance, including Medicaid recipients, and the state will be put in a position of reporting when recipients drop off the Medicaid rolls.

False. The ACA DOES NOT require individuals to belong to Medicaid or purchase private insurance if their income is below the Federal Poverty Level or health premiums would exceed 8% of their income. As a result, restoring coverage for childless adults under Prop 204 and expanding eligibility up to 133% of the Federal Poverty Limit DOES NOT require Arizona to enforce the individual mandate since those individuals are EXEMPT from the mandate to start with.

Legislators who value fiscal prudence, the health of the state’s future economy, and individual liberty should not support the expansion of Medicaid.

Legislators who value creating Arizona jobs, protecting Arizona health care and keeping Arizona tax dollars in Arizona should support the Governor’s Medicaid Plan.

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