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Positioning Our Wyoming Health Care System to Succeed

You are likely to hear two arguments — myths, really — favored by Medicaid expansion advocates.  The first is that Medicaid expansion will save our Wyoming hospitals; the second is that all enrollees will have their health needs met. 

As for our hospitals, is true that the discounted “100% reimbursement” promised by the federal government for an estimated 17,600 new able-bodied enrollees (but not for current enrollees), combined with an expected surge in usage, particularly of emergency facilities, would bring an infusion of cash. But such reimbursements, even adding the tempting new Medicaid enrollee federal version, are not sufficient to sustain our hospitals over time. 

Reimbursements for those more needy currently on Medicaid are approximately 50% of market rates.  In his December testimony to the Labor Committee, Dr. John Mansell of Gillette explained, “Medicaid reimburses hospitals and healthcare providers at a deeply discounted rate, barely covering the variable costs of care but not the fixed costs.  In other words, it pays for the bandaid, but not the building in which you receive it.”

Dr. Mansell suggests that if subsidies are required, it is easier to work with 27 hospitals than it is to work with thousands of new enrollees.   Any cash inflow from Medicaid expansion would be a stopgap measure at best.  Federal reimbursement levels are highly likely to decrease; they will not “save our Wyoming hospitals” in spite of an initial $100,000,000 worth of bait that leaves the state on the hook.  According to the October CREG report, severance tax income will level off; so too must state expenditures level off.  If Medicaid expands to cover one in five people in Wyoming we may be forced to institute a personal income tax to support it.    

The second myth is that Medicaid insurance will actually benefit those between 100% and 138% of the Federal Poverty Level who cannot afford health insurance. This myth is based on the false assumptions that health insurance is the same as health care, that the federal and state governments can afford such subsidies, that having health insurance improves health outcomes, that health care will be accessible, and that everyone is equally in need of help.   Dr. Mansell writes, “We need to treat the person who can’t feed, bathe, toilet, and dress themselves differently from the person who can’t perform a manual job.”    

“Insurance” is an empty promise when wait times can exceed lifetimes.  Bringing able-bodied people into entitlement dependency would not only put Wyoming economically at almost certain risk; it would put those slated to be “helped” at risk.  There is ample evidence that government health care systems fail those who become dependent on them, especially in case of serious illness, because inevitable underfunding and over regulation wreaks havoc with the supply of doctors, nurses, and technicians as well as with hospital beds and equipment.      

It is time for Governor Mead and legislators to create a commission consisting of informed health care advocates who think beyond, “How can we manipulate reimbursement formulas to triage income to the current system?” but instead have the courage to ask, “What can we do to address the health needs of real people?” 

In order to find real answers we need to take a clear look at the myths regarding the — supposed — provision of health care.  There are habits and ways of doing business that must be set aside and replaced by market solutions such as deregulation and, as Dr. Mansell suggests, focusing on the truly needy. The truth is that Medicaid is a dysfunctional program that needs to be eliminated so that real solutions can emerge.  Let’s not make promises to vulnerable people that we cannot keep – instead, let’s position our Wyoming health care system to succeed.

The SHARE Plan and Medicaid Expansion, Part 1
The SHARE Plan and Medicaid Expansion, Part 2

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Wednesday, 23 August 2017
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