Thursday, April 10, 2014

There Really Is No Free Money

This is an op-ed that I wrote about the expansion of Medicaid in North Carolina. It was published in the Thursday, April 10 issue of the Rhino Times.

The Greensboro City Council recently voted in favor of a resolution asking the State of North Carolina to expand Medicaid. This expansion would be offered by the federal government as a part of the Affordable Care Act, also known as Obamacare. It has been explained that the federal government would pay 100 percent of the cost of expansion for the first three years, and then the State would assume 90 percent of the cost thereafter.

While I respect the views of the City Council, I disagree with their stance on this topic, and I maintain that the state legislature made the right decision by choosing not to expand Medicaid. Here are the reasons why I voted with our conservative majority in favor of not expanding Medicaid:

The costs are hard to predict. After three years the State would have to assume 90 percent of the cost, and it is hard to predict what the cost would be. And there is a good chance that it would cost more than what our budget forecasters predict.

The federal government would not cover the increased administrative cost of expanding Medicaid. Our taxpayers 
in North Carolina would incur these expenses. It would increase government bureaucracy, which would create long-term budget obligations.

It is unwise to rely on the federal government. While the federal government claims to pay 90 percent of the cost after three years, there is no guarantee that the feds will uphold their promise. If the feds renege on their promise, then North Carolina’s taxpayers would have to pay the bill.

The federal government is not financially stable. Our national government is spending enormous amounts of money and growing trillion dollar budget deficits. This type of spending is unsustainable and problematic. If North Carolina were to partake in the Medicaid expansion, then we would be contributing to the problem. It is important to remember that there is no such thing as “free money.”

It doesn’t make sense to expand a system that is in need of repair. Our focus should be on improving the quality of our current system. If we expand Medicaid, then we would be making it much more difficult to streamline the system for long-term sustainability.

Expansion would result in thousands of individuals dropping out of private health insurance plans, and then enrolling in Medicaid.
The proposed expansion of Medicaid is crafted in such a way that it would result in thousands of individuals leaving private health insurance in order to enroll in Medicaid. This would expand bureaucracy and shift additional costs to our taxpayers.

It is important that we take a cautious, methodical approach when making decisions that will have a long-term fiscal impact on our State. We also need to be skeptical about any action that will result in the expansion of government bureaucracy. As a legislator, it is my duty to protect taxpayer dollars to the best of my ability.

For these reasons I maintain that we made the right decision by choosing not to expand Medicaid. Doing so would involve too much fiscal uncertainty, and it would place the financial burden squarely on the shoulder of North Carolina’s taxpayers. Our goal moving forward should be improving the integrity of our Medicaid system by making it more efficient, cost-effective, and predictable.