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ObamaCare and Medicaid: What It Means for the States. Christie Herrera Director, Health and Human Services Task Force American Legislative Exchange Council Presentation before the Galen/IPI “Medicaid and the States” Hill Briefing Thursday, October 7, 2010. About ALEC.

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obamacare and medicaid what it means for the states

ObamaCare and Medicaid:What It Means for the States

Christie Herrera

Director, Health and Human Services Task Force

American Legislative Exchange Council

Presentation before the Galen/IPI “Medicaid and the States” Hill Briefing

Thursday, October 7, 2010

about alec
About ALEC
  • ALEC is the nation’s largest, nonpartisan membership association of state legislators.
  • ALEC has 1,600 legislators across the country, which is about 1/4 of all legislators nationwide, and 77 “alumni” members in Congress.
  • ALEC’s mission is to promote Jeffersonian principles in the states: free markets, individual liberty, limited government, and federalism.
  • ALEC promotes its principles through model legislation. In 2009, 10 states enacted health-related model legislation drafted by ALEC. Since 2005, 30 states have enacted ALEC health policy legislation.
obamacare and medicaid an overview
ObamaCare and Medicaid: An Overview
  • ObamaCare and Medicaid:
  • What it means for the states
  • -Skyrocketing enrollment -Bloated budgets
  • -Restricted access to care
  • -Poor health outcomes
  • How states are fighting back
  • -Lawsuits
  • -Legislation
  • -Other strategies
  • What real reform looks like: Florida’s success story
obamacare bloated budgets
ObamaCare = Bloated Budgets

MEDICAID SPENDING PER CAPITA, FY 2007

Source: StateHealthFacts.org

obamacare bloated budgets1
ObamaCare = Bloated Budgets

PERCENT OF BUDGET SPENT ON MEDICAID, FY 2008

Source: StateHealthFacts.org

obamacare big cuts in other priorities
ObamaCare = Big Cuts in Other Priorities

Source: National Association of State Budget Officers

the problem with federal funding
The Problem with Federal Funding
  • Federal money isn’t “free”—everyone pays federal, state, and local taxes.
  • It doesn’t cover everyone. One in four uninsured are already eligible for Medicaid, but not yet enrolled. When they do, states won’t get enhanced funding.
  • PPACA’s Medicaid “doc fix” fully subsidizes provider reimbursement rates up to Medicare levels until 2015—when states will face political pressure to pick up the tab.
  • Administrative costs add 5.5% to total benefit costs, so states are still on the hook even with enhanced federal funding.

Sources: National Institute for Health Care Management Foundation,

The Heritage Foundation

obamacare restricted access
ObamaCare = Restricted Access
  • Medicaid is now the only option for low-income Americans.
  • 40% of doctors restricted access to Medicaid due to low reimbursement rates.
  • 50% of doctors accept new Medicaid patients compared with the 70% that accept new Medicare patients.
  • 2/3 of ER “frequent fliers” were covered by Medicaid/Medicare.
  • Medicaid patients are twice as likely as the uninsured, and five times as likely as the privately-insured, to be an ER “frequent flier.”
  • Medicaid patients are twice as likely as the uninsured, and four times as likely as the privately-insured, to use the ER.

Sources: Office of Senator Tom Coburn, Annals of Emergency Medicine,

National Center for Health Statistics

obamacare poor health outcomes
ObamaCare = Poor Health Outcomes
  • Medicaid patients who need surgery are 13% more likely to die than the uninsured, and 97% more likely to die than those with private insurance.
  • Medicaid patients are 50% more likely to die after bypass surgery because of poor follow-up care.
  • Medicaid patients with cancer are two to three times more likely to die from the disease.
  • Medicaid mothers received less prenatal care and hadhigher infant mortality rates than those with private insurance.
  • Florida: Medicaid patients are 31% more likely to have late-state breast cancer, and 81% more likely to have late-stage melanoma.

Sources: Heartland Institute, Wall Street Journal,

Office of Senator Tom Coburn, National Review Online

fighting back florida v u s dhhs
Fighting Back: Florida v. U.S. DHHS
  • + 16 AGs (FL, SC, NE, TX, UT, LA, AL, CO, PA, WA, ID, SD, IN, ND, AK, MI)
  • + Four governors (MS, AZ, NV, GA) and NFIB
  • March 23: Initial complaint filed in Northern District Court of FL
  • June 16: Feds file motion to dismiss
  • September 14: Oral arguments before Judge Roger Vinson
  • October 14: District Court decision on motion to dismiss
  • December 16: Hearing on summary judgment
  • MAJOR ARGUMENTS
  • Congress can’t compel the states to assume unfunded mandates levied in PPACA (Commerce/Guarantee Clauses)
  • The states can’t be commandeered to administer and fund the health insurance exchanges (10th Amendment)
  • The states can’t be forced to expand their Medicaid programs at significant cost to the states (Article I, Sections 2 and 9)
  • The individual mandate is unconstitutional (Commerce Clause)
fighting back legislation other
Fighting Back: Legislation/Other
  • ALEC’s model Freedom of Choice in Health Care Act has been introduced or announced in 42 states
  • Six states enacted it statutorily: VA, ID, AZ, GA, LA, MO
  • Three states will have it on the ballot: AZ, OK, CO (petition initiative)
  • Resolutions against Medicaid expansion/unfunded mandates
  • Resolutions or study bills calling for Medicaid “opt-out”
  • Involvement in the rulemaking/comment process
  • Public conversations with stakeholders (Heineman)
real reform florida s medicaid pilot
Real Reform: Florida’s Medicaid Pilot
  • 2005: Medicaid reform pilot went live in Broward & Duval Co.
  • 2007: Medicaid reform pilot went live in Baker, Clay, Nassau Co.
  • Insurance companies compete in “Medicaid marketplace”
  • Beneficiaries get core benefits and choose “customized” ones
  • Workers can opt-out and get premium assistance for ESI
  • Healthy behaviors earn money in “Enhanced Benefit Accounts”
  • Multilingual “choice counselors” help beneficiaries pick a plan
  • THE RESULTS
  • Beneficiaries can choose from up to 12 competing plans
  • Plans are offering benefits not covered by Medicaid
  • 80% of benefit packages don’t require a copayment
  • 80% of beneficiaries are voluntarily choosing their own plan
  • 97% of beneficiaries are satisfied with choice counseling
  • Beneficiaries earn over $650k/month in Benefit Accounts

Source: Florida Agency for Health Care Administration

contact us
Contact Us!

Christie Herrera

Director, Health and Human Services Task Force

American Legislative Exchange Council

1101 Vermont Avenue, N.W. #1100

Washington, D.C. 20005

(202) 466-3800

[email protected]

http://www.alec.org

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