A number of constituents have expressed an interest in the current state of Medicaid. Here is a brief synopsis of the current state of Medicaid in Virginia.
In 2001, 666,855 citizens were enrolled in the Medicaid program. In 2011, that number increased to 1,060,840—a 59% increase since 2001. Over the past ten years, Virginia expenditures on Medicaid have gone up 300%!
What’s the bottom line? When it comes to Medicaid, there is just not enough money to pay for everything. With a 59% increase in the number of people on Medicaid, and a 300% increase in costs over the last decade, it is obvious that our present course is mathematically unsustainable. I have had many well-meaning letters requesting increased spending on Medicaid. I am very sympathetic, and I am doing my best to limit cuts to Medicaid.
That explanation reflects the current state of Medicaid. But we are in for big changes with the federal “Affordable Healthcare Act” (aka “Obamacare”), becoming effective in 2014. The Act specifies that if Virginia elects to include people into Medicaid who make-up to 133% of federal poverty level, we will have to add over 450,000 people to the Medicaid rolls. The costs associated with this increase would be astronomical. The federal government says it will pay 100% of the costs for two years, and 90% every year thereafter. But there is one question I have: Where is this money going to come from?
The federal government is broke! They borrow 40% of every dollar they spend. This is starting to sound like another “bait and switch” where the feds ask us to set up a program under the promise of paying for it, and when it gets tough to find the money, simply eliminate the funding.
Here is an analogy: A man comes to you and says, “Would you buy that house for me? I promise I will pay you?” If that man made $24,000/year, spent $33,600/year, and had a $85,333 credit card debt, would you buy the house? The answer is “No.” These are the same ratios of spending and debt currently used by the federal government.
Even IF, the federal government lives up to its promise to pay 90% of our bill after 2019, our share will still cost Virginia over $700 million between 2019 and 2022. As your Delegate, where am I going to find $233 million a year? When you consider that 50% of the budget is schools, 25% is Medicaid, and 10% is public safety, there is no way to find $233 million without cutting one or all of these, or raising the taxes.
If my concerns are alleviated and we can enact significant reforms, I will vote to expand Medicaid. We are investigating accepting the additional people and the federal funds, if and only if, the following requirements are met: (1) If the federal government ceases making these payments, we are allowed to walk away; (2) The federal government will allow us to reduce Medicaid costs by $233 million per year, so that when the 90% payments hit, we will not be paying more than today; and (3) The federal government will allow Virginia to initiate significant reforms. (E.g. The Joint Legislative Audit and Review Commission found that there is up to $90 million per year in fraud, waste, and abuse. But in order to fight it, we need permission from the federal Medicaid program to enhance enforcement methods. Remember that Medicaid is a joint federal and state program. In order to initiate reforms, states need federal permission).