Policy & Progress article: A Life-Saving Act - Voting to Expand Medicaid

By Adam Linker, Policy Analyst for the NC Justice Center’s Health Access Coalition

AUGUST 2012 — It’s not often that state politicians get to save thousands of lives with a single vote. Legislators in Raleigh will have the chance when they reconvene in January 2013 for the next session of the General Assembly.

This privilege comes thanks to the Affordable Care Act, the comprehensive health reform package signed into law by President Obama in 2010. The law expands health insurance coverage to nearly all American citizens.

This coverage comes in two flavors. For middle-income families – making up to $88,000 annually for a family of four – reform provides subsidies to help pay insurance premiums and caps out-of-pocket expenses. Those of more meager means – about $15,000 per year for an individual – can enroll in Medicaid once health reform is fully implemented in 2014.

At least that was the plan until June 28, when the Supreme Court ruled on health reform. While the justices upheld the law as constitutional and left most of it intact, there was a wrinkle in the ruling.

The justices decided that if a state refuses to expand Medicaid, as the health reform law requires,  the federal government cannot boot the state out of the Medicaid program. The risk of losing Medicaid—which is paid for mostly with federal dollars and provides medical and other care services to people who are elderly or who have disabilities—would have coaxed even reluctant states into implementing the expansion.

The ruling means it is likely a few retrograde states will refuse to expand Medicaid.

In North Carolina, the Supreme Court’s decision has put the question of whether to expand Medicaid into the legislature’s hands. Fortunately, our state is unlikely to follow some of our hotheaded neighbors in their decisions to deny health insurance to low-income residents.

What Expansion Would Mean for North Carolina

Refusing to expand Medicaid would mean turning down $20 billion in federal funds that would flow to the state over ten years to help cover the uninsured.

It would mean imperiling the financial solvency of many rural hospitals that currently provide a lot of free care and are struggling; under Medicaid expansion, they would see a significant and much-needed increase in their numbers of insured patients.

And rejecting Medicaid expansion would mean allowing 2,840 people to die every year unnecessarily.

That last point comes from a recent Harvard study published in the New England Journal of Medicine. The authors examined states that dramatically expanded Medicaid in recent years and those that did not. Researchers compared states with similar demographic profiles and ruled out reasons why people in one state might live longer than people in another state.

They found that expanding Medicaid by 500,000 enrollees is associated with 2,840 fewer deaths. Medicaid, the authors concluded, likely saves lives.

That makes sense. You can’t catch cancer early enough to treat it effectively if you can’t afford screenings, which are not provided free in the emergency room. To get them you need to visit a doctor and you will need to have insurance or cash. You also can’t get treatment for high blood pressure or diabetes if you don’t know you have the condition and you can’t afford the medication.

In North Carolina the Medicaid expansion would cover more than 500,000. So that’s 2,840 lives saved every year.

Providing Life Support to Rural Hospitals

Expanding Medicaid will not only save lives, it will also save hospitals. In some rural areas of the state, hospitals provide free care to patients who can’t afford hefty medical bills—and that’s many, many people in North Carolina’s rural communities. Because health reform legislation banks on new patients possessing Medicaid cards, the law phases out federal funds to help support hospitals that provide large amounts of free care. Many hospitals will also see reduced reimbursements for Medicare as policymakers try to rein in spending.

North Carolina hospitals can weather these changes with an influx of newly insured Medicaid patients. But if Medicaid is not expanded, several hospitals may tank, resulting in a dramatic decrease in the availability of quality care in rural communities.

It’s now up to the legislature. Lawmakers can save the lives of thousands of constituents and save local hospitals. They should be glad for such an opportunity.

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