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Reigning in out-of-control Medicaid spending: How Maine did it

Maine has a success story to tell about how Obamacare ought to be repealed and replaced

By J. D. Heyes

(NationalSentinel) Healthcare Reform: For years now I have been following Maine’s fiscal experimentation with public policies that have bucked the national trend. And during that time I have watched in amazement at how the state has managed to get its fiscal house in order and reduce spending on the most expensive federal entitlement programs – welfare and Medicaid – while still managing to deliver quality, targeted care to the most needy without breaking the state treasury.

Now, officials in Maine want the rest of the country to know that as Congress debates the best way to repeal and replace Obamacare, one of the key pillars of any new legislation has got to be immediate repeal of Medicaid expansion, among other steps.

Writing in The Daily Signal, state commissioner of the Maine Department of Health and Human Services, Mary Mayhew, discusses how her state did it and why it should be the model for any Obamacare repeal/replace moving forward (Hint: She says the legislation being discussed right now will not accomplish what needs to be done in order to rein in out-of-control Medicaid spending).

As conversations swirl on Capitol Hill and across the nation regarding the repeal of Obamacare and Medicaid reform, I would like to describe Maine’s success in reducing Medicaid enrollment by 24 percent in the last five years and why our experience is relevant to the ongoing debate.

In our corner of the United States, we have made tough decisions to restore fiscal discipline and strengthen our financial commitments within Medicaid for our elderly and disabled.

[…]

For more than a decade, Maine’s finances were in perpetual crisis because of explosive Medicaid growth and out-of-control spending. This is the very same scene that we see playing out today in many of the expansion states as they grapple with sizable state budget shortfalls.

With their significant federal matching rate, these states are turning to rate cuts on services supporting the elderly and disabled to fill their state shortfalls and balance their budgets as states must do.

A disturbing trend not discussed nearly enough but is painfully obvious: Obamacare has essentially created a golden circle around the able-bodied adults on Medicaid with the substantially higher federal matching rate.

This is why we’ve spent the last six years reining in Maine’s Medicaid program. As we’ve reduced enrollment by 24 percent, we’ve contained spending to an average 2 percent rate of growth compared to the national average of 6 percent.

This year, we are forecasting a 0.7 percent increase. (RELATED: Reality: Not everyone was covered under Obamacare, either)

At the same time, however, we have been able to increase funding to nursing facilities by over 40 percent, increase rates to home care by 60 percent, and add an additional $100 million to support the needs of individuals with intellectual and developmental disabilities.

Additionally, we’ve invested in increased support for primary care to better manage individuals with chronic diseases and to integrate primary care and mental health for those struggling with mental illness.

None of these priorities would have been funded in Maine had we expanded Medicaid. And unlike Maine’s previous expansion years, our uninsured rate has declined.

With Medicaid’s fiscal crisis now behind us, and with Gov. Paul LePage’s leadership, Maine has reduced taxes, stimulated job growth, and is experiencing one of the lowest unemployment rates in nearly 10 years at 3.8 percent.

What does Mayhew recommend?

The federal government must now take a similar approach in repealing Obamacare.

We must reduce the size of this massive government entitlement program, lower the tax burden on our states to promote job growth, and re-establish Medicaid’s core mission of supporting our elderly, disabled, and extremely low-income families.

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Specifically, here are four actions Congress should take to reform federal Medicaid:

  1. Repeal the Medicaid expansion.
  2. Enact an immediate freeze on new enrollment.
  3. Roll back higher the Federal Medicaid Assistance Percentage by 2019.
  4. Mandate work requirements for able-bodied adults, similar to the Supplemental Nutrition Assistance Program.

The current House proposal that delays the repeal of the Medicaid expansion will absolutely trigger a push to expand Medicaid in nonexpansion states—Maine included—by the same advocacy groups that have been trying for the last several years.

Such an effort will bankrupt our state and send us backward from the economic stability we have achieved today.

We cannot afford to go back.

This awful experiment in destroying the U.S. health care system via the massive expansion of Medicaid – which also massively expanded government control over healthcare, hence the system’s failure – has got to come to an end. Economically, it’s unsustainable. Policywise, it’s just not working.

The best way out is the Maine way – allow states and local leaders the flexibility to figure out what works best for them.

Lots of things come from Washington, D.C., but solutions generally aren’t among them.

1 Trackback / Pingback

  1. Kill The Medicaid Entitlement! – Lexington Libertarian

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