By Leslee Kulba-On Wednesday, September 18, Becki Gray and Katherine Restrepo of the John Locke Foundation visited Asheville with a presentation on the implications of ObamaCare for North Carolina. Gray is the organization’s longtime vice president for outreach, and Restrepo is its new policy analyst specializing in health and human services. Restrepo interned at the Cato Institute under the tutelage of welfare expert Michael F. Cannon. With the formal title, “ObamaCare and Medicaid Reform in North Carolina: What It Means to You, Your Healthcare, and Your Pocketbook,” the road show paid a visit to the Renaissance Hotel for a luncheon presentation.
Kory Swanson, a genius in the art of hospitality, served as MC. Behind him, as the program began, was a picture of a scary tornado brewing. He thought it symbolized how elements of calamity are now combining for the perfect storm in American healthcare.
Gray began hammering facts. One of the most important takeaways from the presentation is that everybody is confused by what Obamacare is and uncertain about what it will become. There is, however, a prevailing cynicism that the president is going to make it law, regardless of how many other laws he must break in the process. Deborah Yelton, who was in the audience, explained how in her line of work she is advising healthcare professionals to be prepared for everything – just in case.
The other major takeaway was that Obamacare is not intended to promote widespread health and wellness inasmuch as it is a way of addressing government’s unsustainable spending habits. At the federal level, unfunded liabilities in the form of promises for Social Security and Medicare are now estimated to be anywhere from $100 trillion to over $200 trillion.
In the State of North Carolina, Medicaid is leviathan. The political debate is often reduced to the false dilemma of whether poor children should suffer without medical attention or poor moms should treat their kids to free visits to the emergency room every few weeks. Restrepo coauthored a policy analysis of Medicaid in North Carolina with Jonathan Ingram, director of research for the Foundation for Government Accountability. Listing many facts and recommendations shared at the luncheon, “The Partnership for a Healthy North Carolina” is available online.
In the last fifteen years, the population of North Carolina has increased 25 percent. Over the same time period, Medicaid enrollment has doubled. Over the last decade, Medicaid spending has increased 90 percent, from $8 billion to $14 billion. The economy, by contrast, has not even increased 50 percent. On top of that, per person Medicaid expenditures continue to grow. North Carolina spends $6098 per Medicaid enrollee, which is more than any other state in the region, and more than the national average of $5535. Georgia gets by spending only $3979 per person.
North Carolina’s Medicaid program has run deficits in the last four years of, on average, 11 percent, cumulating a deficit over that period of $5.4 billion. That’s OK, though, because about two-thirds of North Carolina’s Medicaid spending is reimbursed out of the national debt. This year, at $3 billion from state taxpayers and a $14 billion federal match, Medicaid spending comprises 15 percent of the state budget.
Meanwhile, Medicaid is losing favor among physicians. 25 percent of North Carolina physicians won’t accept new Medicaid patients. Furthermore, Restrepo cited studies concluding Medicaid patients get all-around worse care than others, and that quality of care is only deteriorating. Esteemed medical journals report children covered by Medicaid are six times less likely to get appointments with specialists. For some conditions, the rejection rate is 83 percent. Studies also indicate Medicaid children receive worse care than their privately-insured counterparts.
Gray commended State Auditor Beth Wood for her investigation of Medicaid spending. Earlier this year, she reported that the cost of administering Medicaid in this state was 38 percent higher than the average spending in nine comparable states, translating to about $180 million in waste. Among other things, Wood concluded 10 percent of the Medicaid budget was administered fraudulently. Gray emphasized that was only the sloppy fraud that wasn’t hidden well. In one instance, $131 million was withheld from the federal government, and $13 million was awarded to nursing homes as “inflationary adjustments.”
The current system is wrecked, but Obamacare would only make things worse. Hope of political support for marketplace healthcare seemed a joke. One-fifth of Americans are already on Medicaid. That Obamacare was designed to erode away the private healthcare industry was a given. As far as competition goes, it looks like private sector healthcare in the state is shaping up to be a choice between Blue Cross/Blue Shield and Blue Cross/Blue Shield.
To assess their personal damages, people were referred to the Obamacare calculator availed on the Kaiser Family Foundation’s web site. A family of four earning $94,000 a year would qualify for subsidized healthcare. Opting out would be cheap at first, but, as one member of the audience highlighted, when the healthy opt out, there won’t be enough payers to cover costs for the ill. Therefore, the opt-out penalty will have to increase to unbearable levels. Anybody who had tried to make the numbers work ran out of taxpayers.
Members of the audience shared findings and fears about the future of healthcare. Folks grumbled about the bureaucratic, mistake-prone IRS getting everybody’s personal medical data in hacakable electronic form; and the confused navigators who couldn’t fathom the political implications of the verbiage in the 2700-page document. In the air was the sense that the only rule was, “Heads, Obamacare wins. Tails, we lose.”
On the bright side, Governor Pat McCrory is onboard with several of Restrepo’s recommendations, emulating healthcare reform programs with a fiscal fighting chance from Florida, Kansas, and Louisiana. And a handful of senators at press time are still fighting to defund the beast.