This commentary originally appeared in The Dallas Morning News on August 17, 2016.
The idea of expanding Medicaid may be well intended, but it will lead to a unfortunate outcome for the people of Texas.
We need look no further than our neighboring state, New Mexico, to see what happens when a state expands Medicaid under the Affordable Care Act.
As originally signed into law on March 23, 2010, the ACA required all states to expand their Medicaid programs to cover people with incomes up to 138 percent of the federal poverty level. Then the U.S. Supreme Court struck down that provision of the law saying that Medicaid expansion must be voluntary and could not be federally mandated.
Nineteen states including the Lone Star State chose not to expand their Medicaid eligibility standards. Thirty-one states and the District of Columbia did expand, including New Mexico.
There, a Legislative Finance Committee analysis suggested that expansion could bring in as much as 3.5 billion additional federal dollars into a state where the total budget was only $5.6 billion. Both the Legislature and a Republican governor could not resist all that "free" cash. Medicaid expansion was passed, signed into state law, and became effective in 2014 along with the rest of the ACA.
The New Mexico Legislative Finance Committee had also projected that enrollment in their state Medicaid program could increase by as much as 212,000 people by 2020. In fact, within two years, more than 300,000 were added to the rolls making 41 percent of the entire state population of New Mexico eligible for "free" Medicaid insurance. (In Texas, 17.9 percent of the population is enrolled in Medicaid.)
New Mexico is now facing a Medicaid budget shortfall of $416 million for 2017, despite the influx of federal dollars. With no other alternative, the state had to cut the already low Medicaid reimbursement schedule for doctors even further. Thus, there will be fewer providers to care for an even greater number of Medicaid patients. As Robert Moffett of Heritage Foundation warned Congress in 2009, "You can't get more of something by paying less for it."
At the same time as the ACA increased the number of insured Americans, Obamacare also reduced the number of providers. In 2014, the U.S. had 385 licensed physicians per 100,000 people. Two years into implementation of Obamacare, the national ratio had dropped from 385 to 280. In Texas, even without Medicaid expansion, our provider shortage worsened: between 2014 and 2016, the ratio of doctors to patients fellfrom 269 doctors per 100,000 people to 208.
In a recent web-based survey by Nielsen Holdings, more than 60 percent of 1,000 Texans surveyed said they favored Medicaid expansion here. Interestingly, most admitted that they knew nothing about what such expansion meant or would do. They just thought healthcare was in such a sorry state, that any change had to be an improvement. Regrettably, that is not so.
Evidence shows that expanding a Medicaid program actually reduces the availability of medical care to poor patients while raising costs. That is precisely what Texas does not need.
Dr. Deane Waldman is the Director of the Center for Health Care Policy at the Texas Public Policy Foundation.