When the recent Supreme Court ruling upheld the constitutionality of the health care reform law, it also opened up new questions about Medicaid that were explored at length by Winthrop Quigley’s UpFront piece “Medicaid Expansion the Next N.M. Debate.”
Although Gov. Susana Martinez has publicly questioned whether it’s in New Mexico’s best interest to comply with expanding Medicaid starting in 2014 as part of the Affordable Care Act, opting out wouldn’t just be a burden to my hospital and the patients I treat – it would be turning down the deal of the decade.
The law expands health care coverage in two ways.
The first is by creating health insurance exchanges for individuals and small businesses to shop for comprehensive insurance plans at a subsidized rate. To her credit, the governor has moved New Mexico forward, and our state exchange is finally in the works.
The second is by extending eligibility for Medicaid. Medicaid, which currently only covers low-income citizens who meet certain conditions, will be expanded to cover all single adults making a little less than $15,000 per year and a family of four making about $30,000 a year. Expanding Medicaid alone would give coverage to an additional 170,000 New Mexico children and adults. But the Supreme Court’s ruling gives states the option of rejecting this expansion – and the federal dollars that come with it, as Quigley pointed out.
Rejecting this funding would be a disaster for New Mexico.
I saw the patients who would benefit from this expansion while I was training as a resident physician at University of New Mexico Health Sciences Center in Albuquerque. Most of them come from hardworking families. They play by the rules, pay their taxes and want what’s best for their children.
But the astronomical cost of health insurance places it out of reach for their family budgets. As a result, too many of them cut back on the care I prescribe for their conditions and far too many of them skimp on preventative care that keeps them healthy in the first place – all because they can’t afford it. … But even if I were unmoved by the precariousness of my patients’ financial stability, I would find the effect of the Medicaid expansion on my state and my county’s fiscal well-being to be equally compelling.
Right now, hospitals and providers are treating the 24.7 percent of New Mexicans who are uninsured, and too often that treatment remains uncompensated care because the patient is simply unable to pay. In fiscal 2011, UNM alone reported providing $198 million in charity care and care for the uninsured.
Who pays for this uncompensated care? We all do.
The state defrays some of the cost of charity care, and Bernalillo dedicates the income from the mil levy to covering some of this uncompensated care. Even with money from the state and county, UNM still reported a gap of over $55 million, which was passed on to insurance companies in the form of higher rates, and then to customers in the form of higher premiums.
Medicaid right now is already a great deal for our state and a pretty good deal for our providers. The federal government pays 77 cents out of every dollar we spend on Medicaid patients, with the state picking up the rest. Though the reimbursements tend to be lower than those of patients with private insurance, the compensation for hospitals and physicians is clearly better than eating the total cost ourselves.
But the expansion under health care reform would turn a great deal on Medicaid into an absolute steal. The federal government would pay the full cost – 100 percent – of these newly eligible patients for the first three years. After that, it would continue to pay 90 cents out of every dollar spent on these low-income New Mexicans whose treatment today is likely to be paid out-of-pocket or through charity care. The nonpartisan Kaiser Family Foundation estimates that compliance with the Medicaid expansion would increase enrollment in New Mexico by 28.3 percent, but would increase the cost of the program for the state by only a measly 2.1 percent.
That’s the deal of the decade.
Martinez should ignore the partisan bellyaching from outside the state, take the money and shift the cost for these patients off the state and county budgets and onto the federal government’s. It’s better for my patients, it’s better for my hospital, and it’s better for our state’s bottom line.