Sorting Out Governor's Claims on Medicaid Spending

The report was titled "Governor touts $175 million reduction in Medicaid spending last fiscal year" and it was in, of all places, the Arktimes Blog. They were suspicious, but short on specifics as to why. Poor though that is, it was still a step up over the establishment media in this state which simply reports these claims from the Governor as fact without any discernible attempt at actual journalism. I look at the bright side though, if they actually did what they are telling you their job is, then there would be no need for citizen bloggers like me to inform the public of the wide gap between Government claims and the real situation.

Not that I am saying that the Governor is lying. What he is saying may be technically true, you just have to listen to him real closely in order to avoid being misled. Nor can he fairly be blamed for putting what he is doing in the best possible light. Human beings are going to do that. But what is supposed to happen now is that the "watch dogs" of the media are supposed to come along and tell you the rest of the story. And that's where the system is failing. The Governor has an approval rating which is far higher than it would be if we had a functioning media in this state. By "functioning" I mean functioning in the traditional way that the media is supposed to- calling politicians on claims that are too skewed or misleading. The media we have now does function- to prop up and support the system we currently have in place regardless of whether it deserves it or not.

So first of all, when the Governor says that they had a $175 million reduction in Traditional Medicaid spending this does not mean that we spent $175 million less than the year before. It means that we spent less than was budgeted for this line item. That is, we did not spend as much as we planned to spend. It is actually unclear from the report whether we spent less on Traditional Medicaid in 2017 than we did in 2016. Now $175 million is a lot of money and if we really "saved" that much this year without spending less than we spent in 2016 then it would be an indication that our budgeted spending increases were pretty ridiculous. I can't tell if that happened or not from the Governor's report and it seems that none of his groupies in the state's media pool bothered to ask.

But the real thing you have to be careful of is that the Governor specified that traditional Medicaid spending was going down. You see, even though legislators like Davy Carter (and even Charlie Collins who is on the Governor's task force engineering these cuts) claimed that "The Private Option/Arkansas Works" were not expanding Medicaid, they were expanding Medicaid. They just didn't expand traditional Medicaid. Instead, they opened up a whole new strain of Medicaid Program. One whose primary goal was to siphon off money from D.C. to fund health insurance coverage for able-bodied adults. Other categories of people were and are served by the traditional Medicaid program.

So you have this new Medicaid program which is, no matter what they call it this year, the expansion of Medicaid for able-bodied adults authorized by Obamacare. Then you have traditional Medicaid which pays groups like developmentally disabled adults, the blind, nursing home care for the elderly, Autism therapy, and health care for many children via ARKIDS. So, new Medicaid is health coverage for able-bodied adults. Old Medicaid is for vulnerable people in our society like children, the aged, and the handicapped.

Total Medicaid spending has not been reduced in Arkansas. In fact it has increased dramatically over the last few years. This is because spending for the new Medicaid program for able-bodied adults has grown tremendously while the cuts are coming from the traditional Medicaid program. A look at the payment structure reveals why. Uncle Sam has paid all the bills for this new Medicaid program up until recently, and still pays for 95% of it now. For traditional Medicaid FEDGOV only pays around 70% of the tab.

Think about that. If the state spends more on Obamacare-Medicaid then Uncle Sugar pays for 95% of it, while he only pays for 70% of traditional Medicaid. So as near as I can tell what the Governor and most of the legislature have been doing is slashing the traditional Medicaid budget for blind people, for kids with autism, for children, and for the disabled, and instead putting every dollar they can in a mushrooming budget for the new Obamacare-Medicaid program for able-bodied adults. They are doing this because the program's incentives are set up so perversely that they can scam more money from Washington if they do this.

Not that FEDGOV really has the money to pay for all of this. They are borrowing it from the Chinese et al to buy votes now and plan on sticking the next generation of children with the tab. I don't complain about having the social programs, I know that with humanity in its current state we are better off with some social spending than without it. But by all means let each generation fully pay for whatever level of spending it finds appropriate. What we have now is people who are telling themselves how wonderful they are to vote to stick today's babies with a crushing amount of debt so that they can hand out social benefits. Even if the social program is good, the way we are paying for it is not.

If you or the ones you love are served by traditional Medicaid, expect more belt tightening to come- all so that able-bodied adults can get their health care for free. The "Provider Led Shared Saving Entity" (PASSE) is a convoluted new model by which the state wants to invent a middle-man to say "no" to traditional Medicaid spending. That is how I see it so far. That way the parents won't be mad at the Governor and legislators like Collins who are slashing the budget for blind people and poor children to pay for Obamacare. The state won't be telling the parents "no" directly anymore. Nor will the providers. Parents are supposed to be mad at this entity the state and the providers created instead. That model swings into operation next month I believe. Then the "savings" from traditional Medicaid to pay for new Medicaid will be even greater.

People who are served by these programs have to take a hard look at what is going on and decide if they are going to continue with this attitude that "all Medicaid is good Medicaid" and stick together with the Obamacare-Medicaid beneficiaries That model usually works but here the result is that the people who counted on traditional Medicaid are taking all the pain and the Obamacare-Medicaid gaining all the benefits. It is time to make some hard choices about which served group is most worthy of those dollars and advocate accordingly.