New Report Details the Incredible Stupidity of Texas' Rejection of Medicaid Expansion

RickPerryFoxNewsMedicaidExpansion.jpeg
Governor Rick Perry went on Fox News after rejecting federal funds to expand Medicaid, arguing that accepting the money so would be like adding people to the Titanic.
In July, Governor Rick Perry sent a letter to Health and Human Services Secretary Kathleen Sebelius explaining why the state of Texas would not be taking part in the federal government's plans to expand Medicaid.

Such an expansion would "enlarge a broken system that is already financially unsustainable" and "threaten even Texas with financial ruin," he wrote. Later, frustrated at the limits of declarative sentences, he turned to metaphor. Expanding Medicaid, he said, would be like adding a thousand people to the Titanic.

It was a curious argument, given the circumstances. Six million Texans lack health coverage, earning the state the distinction of having the most uninsured residents in the country. Both data and common sense predict that expanding access to health care would reduce, not increase, mortality.

As for the "financial ruin" part, it would cost the state $15 billion over a decade to offer coverage to more than a million low-income adults (those making less than $15,401 for an individual, $31,809 for a family of four). The rest of the money -- more than $100 billion -- would come from the federal government in what amounts to around a 1,000-percent return on investment.

A new report sponsored by Texas Impact and Methodist Healthcare Ministries of South Texas and authored Billy Hamilton, a former deputy comptroller and chief revenue estimator for the state, shows just how astoundingly dumb it would be for Texas to reject the Medicaid expansion.

Hamilton concludes that rejecting the federal money would result in 8,400 premature deaths each year and mean that more than a million poor adults and children would still lack health coverage, but Hamilton's argument isn't a bleeding-heart humanitarian plea. He's a money guy, so he focuses on the bottom line, the dollars and cents.

For starters, the state is already on pace to spend at least $15 billion over the next decade on things like indigent care, women's health initiatives and hospital treatment for prisoners. Much of that money could easily be counted toward the state's required match.

A large-scale Medicaid expansion would also streamline the state's scattered low-income health programs, reduce the current $1.8 billion in annual charity care and otherwise save money. And the simple injection of such a large amount of federal dollars would act as a miniature stimulus package, boosting the economic output by $67.9 billion, increasing state tax revenue by $1.8 billion, and creating 231,000 additional jobs by 2016.

The report also feels the need to politely but firmly address a charge that has frequently been leveled at Obamacare, in the process giving a remedial course in political economy.

"Criticism that expanding Medicaid would be expanding 'socialism' is incorrect," Hamilton writes in the report's executive summary. "In a socialist system, the government not only funds but also operates hospitals, hires health care providers and controls every aspect of health care. Medicaid does not do these things; patients and their health care providers make health care decisions. The state accepts federal funds for many other similarly funded programs."

The bottom line? "If politics are set aside, the right decision is obvious," Hamilton told the Texas Tribune.

For now, Perry is sticking to his guns and insisting that uninsured Texans already have access to health care through a federal law requiring hospitals to treat them regardless of ability to pay. But elsewhere, there are signs that legislators might be willing to deal with the federal government to make at least a partial expansion happen. It's either that or leave more than $100 billion on the table.

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47 comments
DanteAlligator
DanteAlligator

Rick Perry should stick to the only thing he does well...painting racial epithets on rocks so rednecks and racists can find their way to the Klan meeting.

bvckvs
bvckvs topcommenter

They KNOW that healthcare reform isn't socialism.  But saying so angers good people, and that gives Republicans a thrill like nothing else can.

Republicans are not here to debate the issue - they're here to heckle those who do.  That's the nature of their character. 

hdpearl11
hdpearl11

It's the right decision not to expand Medicaid. The "economic boost" may be virtuous in aggregate terms, but it's relative affect on the marketplace will be agitation. Any "mini" stimulus package distorts the free enterprise system. A better message for Perry to have delivered is that while the Federal Reserve is keeping interest rates artificially low, Texas will not compromise the sustainability of our current insurance companies (because killing current providers also kills people.) When the interest rates realign, then entrepreneurs can start new economically sustainable insurance companies. More companies, lower cost for all.

A Ft. Worth-O-Plex Music Page
A Ft. Worth-O-Plex Music Page

This is the problem with the "victory" from the Supreme Court on the health care bill. It was NOT a victory. It took away the federal government's leverage to get states to go along with the Medicaid expansion, meaning southern (white) governor's can just decide to screw over the poor & working class (who are disproportionally black & brown). And that's what they're doing. It takes some kind of evil human to deny health care to people, even when someone else is paying for most of it!

Allan Ws
Allan Ws

Dear D.O. people, you live in a state that is republican. Deal with it, if you don't like. *southpark redneck voice* You can get oooutttt. There are plenty of other liberal states out there that share your ideals and beliefs, Texas, not one of them :)

Steve Nabors
Steve Nabors

Rick Perry = Get rich while screwing the world in any way possible

holmantx
holmantx topcommenter

The federal government is accelerating the purchase of its own debt, which is itself accelerating in its issuance.  The CBO now says the National Debt will increase to $25 Trillion by the end of the decade - an amount the finite mind is not capable of digesting.  

This is nothing more than a MASSIVE AND GEOMETRICALLY INCREASING claim on future labor.  And that means you, not me.  Future generations who, when they begin to flow into the middle class, will foot the bill of 50 years of adding to it.  Because since 1960, half this country wanted a huge social net the other half refused to pay for.  So Congress borrowed it. And kept borrowing ever greater sums.

Don't believe me?  Then believe the President.  The Economic Report of the President is an annual report written by the Chairman of the Council of Economic Advisers. It overviews the nation's economic progress using text and extensive data appendices.  his 2012 report is here: 

http://tinyurl.com/crnf2kq

See: Table B-78. (Sources: Department of Commerce (Bureau of Economic Analysis), Department of the Treasury, and Office of Management and Budget.)

And not even the proponents of Obamacare - which includes Medicare/Medicaid - now claim this behemoth will pay for itself.  That's why 27 states sued.  They cannot pay for it.

We can't even pay the interest on what we owe right now.  The Fed is dumping $85 Billion a month into the economy, and the Treasury is buying 70% of the debt they issue because no one else will buy it.

And all we get from the so-called press is WAAAAAAH More!  More!  More! you racists, misogynist homophobes.

Christopher Buentello
Christopher Buentello

Civics? Ur dating yourself with that statement..now it's called American Imperialism. But honestly, you lack any insight into monetary and economic policies. Why don't you go suck your thumb and watch honey boo boo.

Doug Crawford
Doug Crawford

$32,000 (tax free) a year on Medicaid?! Almost free housing ($1000 a month value), $1200 a month in food stamps, free health insurance ($800 a month value), and perks like free cell phones?! THAT'S $68,000 a year tax free! Most working families don't make that, especially after taxes! No wonder the new American dream is to get on the governments tit! Why would you want to work and be productive?! To maybe break even on what you can get for free? You would have to have two people with a $50,000 year job after taxes! A lot of "professional" families don't achieve that! This needs to be the basis of wellfare reform!

Donn D Mershon
Donn D Mershon

Perry keeps posturing for the national stage, thinking of another presidential bid. He blew it so badly in 2012, I wish someone would tell him to relax and just try to be a good governor.

Steve Handy
Steve Handy

Someone failed a lot more than civics. I'd say you could add math, government, US history, economics, etc, etc. Probably a shorter list for what he passed.

Rachael Araiza McDermott
Rachael Araiza McDermott

Just let the poor go to the ER, where the cost is triple and we still get stuck with the bill in the end. NO!! Prevention and access to regular doctors and clinics will save us $$$$.

Christopher Buentello
Christopher Buentello

Our federal govt. is $16+ trillion in debt and we want to beg for more money? This is akin to beating up a homeless person for his/her grilled cheese sandwich...sure yu could do it but its not morally right.

Myrna.Minkoff-Katz
Myrna.Minkoff-Katz topcommenter

Incredible stupidity is one way to explain OOPS and his rejection of covering the state's uninsured.  "Cutting your nose off to spite your face", is another.

m3man2002
m3man2002

Rick the Dick.

Can't do the math to figure at that the 10 to 1 match from the Feds saves the state money and gets health care to millions more people. Rick would rather sacrifice their lives in some vain attempt to establish himself as a national politician. Rick can't do politics either, outside of Texas. There aren't even enough stupid Republicans out there to support him.

The real losers are you taxpayers in urban counties, where your massive Parkland Tax, and JPS tax funds indigent care for the poor in the city, and for the freeloaders in the suburbs, who send their gardeners, maids and construction workers to Parkland, but don't pay the tax. But Rick the Dick doesn't care about them...they vote Democrat. Obamacare solves their problem, but since it ain't  Ricks problem, he'd rather see you get soaked in taxes, and let poor people die, than admit he is wrong.

Meanwhile, your federal taxes will support the uninsured in the rest of the country, while you get no benefits from it, and still get to go bankrupt, if you get sick.

In the end, governor, its  just more proof you are too dumb to get elected anywhere but in Texas.

roo_ster
roo_ster

So many (un)intellectual stolen bases in that sorry excuse for an article, one hardly knows where to start with that mess of pottage.

Medicare is a bad idea and any expansion of it is also bad.  Medicare and other gov't intervention in the health care and insurance market are one of the primary drivers of the inflation of the cost of medical care.

Also, many of those 6 million are illegals, who can go back to Mexico (& points south) and let Mexican taxpayers take care of them.

everlastingphelps
everlastingphelps topcommenter

"Criticism that expanding Medicaid would be expanding 'socialism' is incorrect," Hamilton writes in the report's executive summary. "In a socialist system, the government not only funds but also operates hospitals, hires health care providers and controls every aspect of health care. Medicaid does not do these things; patients and their health care providers make health care decisions. The state accepts federal funds for many other similarly funded programs."

That's true -- Medicare/Medicaid is a much better example of fascism than socialism.  The companies are privately owned, but the prices are fixed by Medicare, and the industry is heavily regulated.  Rather than directly managing the business, the state regulates them so heavily that they really don't have any choice in how they operate (giving the state de facto control even if they aren't the technical owners.)  

Fascism -- it's not "capitalism" or "socialism" -- it's the new Third Way!

MikeWestEast
MikeWestEast

The problem is in 6 or 7 years when the Fed program expires.  Then it is up to state to make up the difference or be the bad guy and start cutting benefits.  Once in, you are stuck and Texas cannot pay the post 2020 bill without huge tax increases at current rates.  Who knows what they will be in 2020?  The hundred billion left is nothing compared to the hundreds of billions it would force on Texas in the 2020's and 2030's.

animas
animas

In this case Oklahoma beat Texas again, having set up health care exchanges for the uninsured over a year ago...

lolotehe
lolotehe

<s>But if they die, we don't have to feed them....</s>

GuitarPlayer
GuitarPlayer

Facts and numbers? Get the fuck out of here, this is Texas.

DanteAlligator
DanteAlligator

@Allan Ws 

Evidently you haven't read the news that Hispanics are replacing Texas crackers at a beautiful rate. Learn some Spanish because pretty soon you're going to have to find another 'white redneck fatherland' for your little blonde, goose-stepping children.

scottindallas
scottindallas topcommenter

@holmantx Right Phelps/Holman--but the solution is to raise the top marginal rate, raise capital gains, and extend the public option plus 15%%.  Now, why do you want to post all this tired crap?   When are you gonna acknowledge the solution, and then advocate for it?  You never could rebut the point; so man up.  Quit hiding from the truth.

Seriously, this guy is a conservative comptroller.  he knows the falsity of your silly low tax argument that ignores there's a difference between net and gross profits.  That effective and nominal rates are the same, that there's anything beneficial in making them more similar.  Deductible avenues are such because they're generally more productive than profit taking.  If you want to discuss how some deductions are bad for the market, that's a serious discussion that I welcome.  If you want to expose the very large give aways to corporate America, let's talk, ie Omni Hotel, Bass Pro Shops...

Montemalone
Montemalone topcommenter

@Doug Crawford Please tell me where I sign up for this largesse of which you speak.

scottindallas
scottindallas topcommenter

@roo_ster Healthcare isn't a "market" certainly not a "free market."  That's why our system is the least efficient in the world.  There's really no point talking to you.  The reason Medicare is a financial sink is because we give all the profitable young to the "free market."  Then, we socialize their liability by picking up the expensive old and elderly.  We could offer the "public option" get many on board and still charge a premium of 15-20%, to repay Medicare. 

Daniel
Daniel

@Montemalone "Simile" would be more precise -- but it is, in fact, a subset of metaphor.

icowrich
icowrich

@smithjosh I have news for you.  We're paying into the system whether or not we participate.  If we don't take those funds, our tax money just goes to other states.

MariaB
MariaB

@smithjosh Please try www.tinyurl.com to avoid long links that frequently "break,"


scottindallas
scottindallas topcommenter

@everlastingphelps it's called a utility.  You might look it up in Adam Smith and Common Law.  Evidently the agenda driven economists you read don't include this distinct market in their non-sense.  It's something Hayek acknowledged and lies behind his support of national healthcare--your deceptive libertarian economists don't discuss that either. 

scottindallas
scottindallas topcommenter

@MikeWestEast the return multiplier on these are far greater than what we blow on Perry's Enterprise Fund.

roo_ster
roo_ster

@scottindallas @roo_ster To the extent it is not a free market, it is because of gov't ham-handed intervention.  Health care and higher education both suffer from too much gov't intervention and both have had rates of inflation much greater than the CPI. 

everlastingphelps
everlastingphelps topcommenter

@scottindallas @everlastingphelps It's still got to be billed for based on consumption.  To make it all-you-can-eat invites the tragedy of the commons.  Healthcare is an individual service.  It isn't general welfare like defense or postal roads.

scottindallas
scottindallas topcommenter

@roo_ster @scottindallas no it's not Rooster.  It's a professional market at the very least, this is distinct from a free market.  Here's a clue, you're not a customer in professional market, but a client, patient or whatever--this is supported by Common Law, and hundreds of years of legal and economic precedent--but you ignore that.  Further, there is not a single private medical school in this country, none.  All doctors have uniquely subsidized educations, (the Service Academies not withstanding)  Further, there are no private insurance providers for those over 65.  That's not because gov't prohibits them, they were never interested in covering such risk.  But, it's a privatization of the profits and a socialization of the liabilities in the market we have.  Insurance companies treat us like rented cars, till the gov't takes over.  But, you cavalierly toss this aside too. 

Further, it's absurd to suggest that we can shop all the potential medical costs before they're needed, and need I remind you, it might well be an emergency situation.  Elective or cosmetic surgery is something akin to a free market; the world of major trauma and ICU care, is another matter.  Read the comments to Phelps below, this is serious stuff; and even a conservative comptroller is starting to scream.  Many of the GOP's serious long time soldiers are speaking out about the juvenile, self serving policies the clowns you listen to are advocating.  It's time you paid attention.  Remember, Obama's been pushing Heritage Foundation policies, and your clowns are calling him a socialist. 

everlastingphelps
everlastingphelps topcommenter

@scottindallas @everlastingphelps That your meddling broke the system doesn't mean the system itself never worked.  You are the hypocrite.  "This system is so shitty!"  Well, let's do things my way, instead of doing it your way, only harder.  "No way, that will turn the system to shit!"  Hypocrite.  You're like the man who murders his parents and then asks for leniency because he's an orphan.

scottindallas
scottindallas topcommenter

@everlastingphelps @scottindallas We could bill it any number of ways.  But, it's a professional market where the exception involves the patient being the payer--in such markets, the fiduciary model breaks down.  Considering there are no private medical schools, and there is no such thing as private insurance after 65, we've already socialized the expensive part.  We're fools to privatize the low cost/profitable years--that's corporate socialism.  Whatever the case, the argument that the major healthcare market is anything akin to a free market is flatly delusional.  And, all evidence supports my thesis, as no "free market" have ever produced better results, against some 50 examples of more fully socialized coverage.  Again, we already cover all the real risk--a Public Option plus 15% is competition--but competition your sophists never consider, or dare hint at.  How much a fool are you that you don't see the hypocrisy? 

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