New Jersey Gov. Chris Christie announced last week that his state will expand its Medicaid program in accordance with ObamaCare, saying he wishes to “ensure New Jersey taxpayers will see their dollars maximized.” Christie is the eighth Republican governor to embrace Medicaid expansion, following Florida Gov. Rick Scott, who announced his support for expansion last week.
There are signs that opposition to expansion remains strong in many states, despite the recent cave-ins from Scott and Christie. In Florida this week, a House committee voted against Medicaid expansion in defiance of the governor’s position, which was not enough to convince Republican lawmakers to go along with the scheme.
In other states, however, Republicans are at risk of being duped into expansion. Last week, Arkansas’ Gov. Mike Beebe announced a deal he’d struck with the feds that would use federal Medicaid funds to purchase private health insurance for everyone below 133 percent of the poverty line on the federal ObamaCare exchange.
While the deal gives some political cover to Arkansas Republicans, who can claim they are moving low-income people into private coverage, over time the arrangement will cost Arkansas much more because private insurance that matches Medicaid benefits (as the Arkansas deal requires) is more costly, especially after the ObamaCare mandates increase the price of health insurance. When the federal match drops to 90 percent after three years, Arkansas portion will be significantly more than it would have been under a simple expansion.
There is always the hope that Arkansas Republicans might reject the deal, as Florida lawmakers did, but the situation illustrates the folly of striking any expansion deal with Washington: giving in to a short-term influx of federal dollars won’t make Medicaid sustainable in the long term, and it won’t fix the structural problems plaguing the current program, which leaves enrollees with poor access to care and taxpayers with a newly-expanded entitlement they cannot afford.