AMAC Exclusive – By Sam Adolphsen
When you hear or read about Medicaid, one of the largest welfare programs in the U.S., the connection to Ernest Hemingway might not be immediately evident.
However, a piece of wisdom from Hemingway’s character Jake in The Sun Also Rises applies to the challenges facing Medicaid today: “Getting something for nothing only delayed the presentation of the bill. The bill always came.”
Nowhere is that sentiment truer than in the Medicaid program. And the bill is coming due in states around the country. Taxpayers and the truly needy had better look out, because the bill must be paid.
Medicaid (not to be confused with Medicare) is a program that was meant for the truly needy, the elderly, the disabled, and poor children. That was before Obama expanded the program to tens of millions of able-bodied adults, including adults with no kids at home, as one of the most controversial parts of Obamacare.
Just twenty years ago, there were only 7 million non-disabled, working age adults on Medicaid. Today, after a decade of Obamacare’s Medicaid expansion, which was partly funded by hundreds of millions of dollars in cuts to Medicare, there are nearly 40 million able-bodied adults on the program.
That means almost half of the people on Medicaid, a program meant for the truly needy, are able-bodied adults who can and should be working. But most of them are not working. State data shows that more than half of those tens of millions of able-bodied adults don’t work at all.
This unrestrained growth in Medicaid, especially among able-bodied adults, is having a major detrimental effect on state budgets. In recent years, the COVID-era deficit spending from Washington D.C. included extra Medicaid funding for states and papered over the budget problems.
Now with that extra federal money going away, the bill has come due for many states. More will soon follow.
California is facing a record budget shortfall of $68 billion after further expanding Medicaid to cover illegal immigrants and raising the income limit well into the middle-class.
New York is facing a $7 billion shortfall this year, much of which can be attributed to an increase of $10 billion in Medicaid costs in just one year. It doesn’t help that New York is also giving Medicaid to illegal immigrants and proposing a new scheme to keep people “continuously covered” for years with no eligibility checks.
So how will New York handle the bill coming due? Predictably, and sadly, by proposing cuts to care for the elderly and truly needy. The governor has already proposed a budget that cut tens of millions that was going to struggling nursing homes.
Where is the discussion of reining in the runaway costs and enrollment of millions of able-bodied adults? Nowhere to be found in New York.
Indiana, which foolishly expanded Medicaid to able-bodied adults years ago despite being a solidly red state, now faces more than a billion-dollar shortfall in Medicaid—just as many conservative opponents of the policy predicted at the time. The Indiana Family and Social Services Administration initially proposed cutting back a service that helps provide in-home care for elderly and disabled individuals. Meanwhile, almost half of Indiana’s two million people on Medicaid are able-bodied adults.
Arizona, another Medicaid expansion state, is facing a huge budget shortfall that could total in the billions of dollars. While the Democrat governor is trying to blame the shortfall on tax cuts and school choice, the reality is that Medicaid expansion is driving the problem. Arizona had just 500,000 people on Medicaid in 2000. After expanding Medicaid, they now have 2.3 million on the program. Nearly a million of those are able-bodied adults.
These are just a few of the states grappling with the Medicaid expansion budget problem. Colorado can’t cut property taxes like they want to because of Medicaid overruns. Maine is proposing to spend millions to hire new state workers to process Medicaid applications after expanding.
The Biden administration is making this problem worse. The Biden Medicaid office, run by the former Attorney General of California, has done everything in its power to keep states from limiting the growth of able-bodied adults on their welfare programs.
The Biden administration has even threatened states that have tried to clean the rolls up after COVID and demanded the adoption of policies that open the door to even more enrollment. This includes, no surprise, pushing states to adopt Medicaid expansion to even more able-bodied adults.
Unless states get the growth in able-bodied adults on their programs under control, there will be proposed cuts to the elderly and truly needy. There will be blown opportunities to cut property taxes. There will be cuts to road repairs and public safety. Or worse.
States that have avoided this Medicaid meltdown like Kansas, Texas, Florida, Alabama, Tennessee, and Mississippi, should stand strong against Medicaid expansion to protect the truly needy who depend on the program, and the taxpayers that fund it.
The bill will always come due. The only question is, who will pay?
Sam Adolphsen is the policy director at the Foundation for Government Accountability, and the former Chief Operating Officer for the Maine Department of Health and Human Services where he oversaw welfare eligibility and fraud investigations.
