Medicaid expansion was a pressing issue last year and it’s an even more consequential issue this year. My office has received several inquiries from constituents on the status of Medicaid expansion in Virginia and where I stand on the issue. I do not support Medicaid expansion in Virginia and I do not believe an expansion decision will be made this session.
Under the Affordable Care Act (Obamacare), Medicaid could be expanded to cover an additional 400,000 new recipients in the Commonwealth. The federal government has promised to cover 100% of expansion costs for the first 3 years, and 90% after that.
In 2013, the General Assembly established the Medicaid Innovation and Reform Commission (MIRC) to review, recommend and approve innovation and reform proposals affecting Virginia’s Medicaid system. This Commission provided for legislative oversight in the process.
MIRC has held eight public meetings and worked over the last year to compile information on the current program’s operations and costs. In the latest MIRC meeting, Secretary of Health and Human Resources Bill Hazel reported 30% of all healthcare spending in Virginia is waste. Waste is primarily considered to be unnecessary services, excessive administrative costs, inefficient delivery services, and fraud. It’s sobering to think that 30 cents of every taxpayer dollar spent on healthcare is wasted.
Attorney General Cuccinelli recovered $200 million in Medicaid fraud settlements in 2013 alone. This highlights the potential level of loss to Virginia every year.
The House Republican Caucus believes expanding a broken Medicaid system is a bad choice for Virginia. Currently, Medicaid costs the Commonwealth almost $9 billion a year and consumes about 22% of our general fund budget. It is the fastest growing part of our budget,growing at an average of 8 percent annually. Expansion could potentially cost an additional $1 billion a year if the federal government doesn’t live up to their promise to pay 90 percent of the cost.
Historically, we have seen the actual costs far outpace the original projections for nearly every major entitlement program in the last 50 years. When Medicare was originally created in the 1960s, it was projected to cost $12 billion annually by 1990. In 1990, Medicare actually cost $110 billion. Today it’s over $500 billion.
What happens when Medicaid is no longer 22% of our budget, but instead 26% or 27%? Medicaid expansion without reforms would require drastic cuts to other core functions of government such as education, transportation, and public safety, or increased taxes on hard-working Virginians.
In addition, nearly 1/3 of all doctors presently will not see Medicaid patients. Medicaid expansion would result in decreased access to general practitioners for low-income Virginian families. Ultimately they’ll be forced into emergency room care. This means more expensive healthcare bills and decreased individualized, personal care.
Fundamentally, that’s why we cannot expand Medicaid. We legislators have a fiduciary duty to you, the people of Virginia, to balance our budget every year. I cannot support expanding Medicaid because by all accounts it is a broken system that is growing unsustainably, decreasing access and quality of care, and plagued with wide spread waste and fraud.
House Republicans have called for a comprehensive financial and operational audit of Medicaid by the Joint Legislative Audit and Review Commission (JLARC), the oversight agency for the Virginia General Assembly. JLARC was established to evaluate the operations and performance of state agencies and programs. We believe a JLARC audit will provide insight on several intricacies of the program, including the “Fee for service” system that covers our high volume/high-cost Medicaid services and the long-term care program for the elderly and disabled.
Ultimately we want to assess the challenges and make recommendations on how to make Virginia’s Medicaid system more beneficial for everyone in the Commonwealth. Citizens of the Commonwealth deserve a more efficient, effective, and accessible Medicaid system.
Last Thursday I enjoyed hosting my first telephone town hall of 2014 where I spoke with some 2,000 constituents. The call afforded me the opportunity to ask constituents in the 66th District if they supported Medicaid expansion. 68% did not support the expansion of Medicaid. My District Legislative Survey reflected even less approval with 85% of respondents against Medicaid expansion.
That’s a clear indication the citizens I represent do not support the expansion. It was also clear from the questions they raised during the Town Hall, they are very concerned and expect us to act prudently. I look forward to another Telephone Town Hall in mid-February.
On January 23, I spoke on the House Floor about why I’m against Medicaid Expansion. Click here to watch the video of my speech.
Kirk Cox is a member of the Virginia House of Delegates.