Republican governors cave on ObamaCare and Medicaid

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  • 08/21/2022

First it was Ohio Governor John Kasich, Jan Brewer of Arizona, Susana Martinez of New Mexico, and Brian Sandoval of Nevada.  Now it’s Michigan Governor Rick Snyder.  They’re all Republican governors surrendering to ObamaCare and expanding Medicaid eligibility.  It’s one of the most expensive parts of President Obama’s health-care takeover, and it’s supposed to be optional… but it turns out to be one of those offers you really can’t refuse.

In case you’ve forgotten how all this works, Philip Klein at the Washington Examiner offered a little primer on Monday, after Kasich folded his cards.  You’ll certainly recognize the famed example of political corruption named in Klein’s account:

When Obamacare was making its way through Congress in 2009 and 2010, the proposed expansion of Medicaid was one of its most controversial elements. As things stood, the program was crushing state budgets, so governors in both parties feared that expanding it to 15 million to 18 million beneficial would be unsustainable. Then Sen. Ben Nelson was infamously given the “Cornhusker Kickback” — expanded federal funding for Medicaid to Nebraska — to win help secure the 60th vote to get Obamacare through the Senate.

The backlash against the “Cornhusker Kickback” cemented the idea in the public consciousness that the process used to pass Obamacare was corrupt, helped elect Scott Brown to the Senate in Massachusetts and added fuel to the Tea Party. Ultimately, lawmakers substituted the special Medicaid treatment for Nebraska in favor of increased federal funding for all states instead. Under the law, the federal government will pay 100 percent of the cost of the Medicaid expansion at first, and then 90 percent after 2020.

This comes at a cost to federal taxpayers — $932 billion over a decade, according to the Congressional Budget Office. To be clear, that’s if all states participate. But last year, 26 states led by Florida won a suit challenging the federal government for coercing states into the Medicaid expansion and the Supreme Court left states with the option of rejecting it.

$932 billion over a decade?  Wow, that’s almost as much as the biggest deficit-busting spending cuts anyone in Washington seems willing to put on the table.  Cutting a trillion dollars over a decade is an impossible, agonizing task – that’s why we’ve got the “sequestration” spending cuts, a legacy of Super Committee failure – but spending a trillion is a snap.

Kasich is a high-profile governor who strongly identified with the Tea Party; Martinez is a rising Republican star.  Their concessions to ObamaCare are a watershed moment that could break down resistance from others who have thus far said no.  It’s never really too late to change your mind and say “yes.”

One of the most prominent refuseniks, Governor Bobby Jindal of Louisiana, is under intense pressure to change his mind.  Jindal has expressed concerns that the federal Medicaid money comes with not only strings, but huge financial obligations, attached.  “The Obama administration heralds this as a tremendous bargain for states,” Jindal wrote in a January op-ed for the Washington Post.  “That’s simply not the case.  The administration overlooks that Medicaid is largely failing current enrollees with its outdated model that costs billions of taxpayer dollars and produces poor outcomes.”

Jindal noted that Medicaid isn’t exactly in great shape as it stands, so dumping millions of new beneficiaries into the program is a strategy all but guaranteed to fail.  He’s proposed a number of reforms for “eligibility, benefit design, cost-sharing, use of the private insurance market, financing, and accountability,” but couldn’t get the White House to discuss them.  Until such reforms are made, Jindal doesn’t want to hitch his state up to a trillion-dollar doomsday machine, even if Washington pays all or most of the cost… at first.

Even if the ObamaCare plan goes off without a hitch (and no other part of it has, thus far) the feds would be paying all of the Medicaid cost for only three years, and then bring the state in to pay for 10 percent thereafter.  Ten percent of a lot of money is a lot of money.  Kasich described this deal as “making great sense for the state of Ohio, because it will allow us to provide greater care with our own dollars.”  This pronouncement is accompanied by the obvious political calculation that voters would punish Kasich at the ballot box for turning down all that “free money.”  Voters are all about “free money” these days.  It’s hard to blame governors for caving in the face of Washington’s vast power to buy votes, funded with both money from taxpayers in other states, and deficit bills hot off the Treasury presses.

That’s one of the problems with allowing the vast accumulation of power and money in Washington.  It doesn’t just push around the people; it has immense leverage over state governments, crushing federalism beneath the sheer will to power.  Ohioans are going to be bled for ObamaCare, and the rest of the federal agenda; there’s no way out.  So why not get a few dimes on the dollar back in goodies?  Or nickels, or pennies, or whatever it ends up being.

Kasich boasts of including an escape clause in his Medicaid agreement, allowing Ohio to withdraw if the federal government doesn’t live up to its end of the deal.  That sounds good today, Governor.  Try exercising that clause in, say, five years, when you’ve got a few million new Medicaid dependents ready to go ballistic if their benefits are cut.  They won’t much care that the federal government reneged on its agreement, in the face of total ObamaCare fiscal meltdown.  They won’t even care if the central government is teetering on the edge of default.  Obligations take root.  That’s the core tenet of the “progressive” death spiral.





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