Reeder: State headed in wrong direction with Medicaid expansion

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SPRINGFIELD -- Sometimes it seems politicians and lobbyists pack in more flip-flops than a busload of college kids heading off on spring break.

Principles are shorn. Taxpayers are fleeced.

In Springfield, even some of the doctrinal stalwarts can be led astray.

Look no further than the Illinois Chamber of Commerce.

The organization is a political powerhouse in Springfield. It represents businesses large and small.

And it has opposed Obamacare.

But a funny thing happened after the election.

The chamber flip-flopped.

You see, while the U.S. Supreme Court ruled most of Obamacare as constitutional, a portion requiring states to expand Medicaid coverage didn’t pass constitutional muster.

It’s now up to individual states to determine whether to expand who is eligible for Medicaid.

Please keep in mind, Illinois’ finances are in tatters for two reasons: Elected officials promised pension benefits the state can’t afford and, during the Blagojevich years, the state radically expanded who is eligible for Medicaid.

With more folks carrying around Medicaid cards, the cost to state taxpayers has ballooned. And Obamacare would have required states to further expand who is eligible for Medicaid, until the High Court ruled otherwise. Now it is voluntary.

Of course in Illinois, where the Democrats control the House, Senate and governor’s office, most folks expected the state to voluntarily comply.

That’s what makes the Chamber’s decision to support voluntary Medicaid expansion so curious.

They have joined the “me too” chorus, giving legislators political cover to vote for something so many businesses in their home districts oppose.

It smells of a backroom political deal.

The Chamber contends that during the first few years, the federal government will pay for Medicaid expansion and the state ought to capture those dollars. But here’s the rub: Those federal dollars are temporary, and when they run out, the state will either have to raise taxes or cut programs to continue the spending.

It’s a future fiscal cliff for state government.

“Every time we expand a program, we take from another program,” said state Sen. Bill Brady, R-Bloomington. “I’m inclined not to support the expansion.”

Not only does Medicaid drain the state budget, it is a pretty lousy option for poor people. Doctors and other providers don’t like Medicaid because it only pays a small portion of the actual cost of treating a patient. That’s led many doctors to stop taking patients in the state program.

Those with Medicaid hate the program because so many physicians won’t take Medicaid patients or restrict the number they will see. In fact, more than 35 percent of Illinois doctors have stopped taking new Medicaid patients, and Medicaid patients are denied appointments with specialists nearly two-thirds of the time.

There are a lot better options for getting more people covered without draining state coffers.

Many of the individuals who would become eligible for Medicaid under the expansion are eligible for federal subsidies to purchase private health insurance.

But they won’t be eligible for those subsidies if Illinois expands Medicaid.

Why stick more people in a broken system and leave Illinois taxpayers picking up the tab?
That doesn’t make any sense. But that is exactly the direction the lawmakers are headed.

• Scott Reeder is a veteran statehouse reporter and the journalist in residence at the Illinois Policy Institute. He can be reached at sreeder@illinoispolicy.org. Readers can subscribe to his free political newsletter by going to Reederreport.com.

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