Friday, November 19, 2010

Cheaper Medicaid through equality

From the 22 November 2010 Greater Niagara Newspapers


By Bob Confer

In New York, more so than most states, Medicaid takes more from society than it puts back into it. It’s a drain on the economy and the overall quality of life. If you’re a homeowner you know that too well. More than half of your Niagara County property tax bill goes towards Medicaid, costing you hundreds of dollars every year. Combine that with what else you put into the Medicaid coffers (state and federal income taxes and 1 full percentage point from sales taxes) and you discover that each Medicaid recipient in New York costs taxpayers $16,000 per year while the average family of four on Medicaid places a burden of $64,000 per annum on our economy.

If you and/or your employer pay for your health care you know those numbers seem unreasonable. They are. A single-subscriber plan through an HMO is slightly more than $4,000 per year while a family plan is just under $12,000. That’s 75 percent and 81 percent less than their respective Medicaid counterparts. From the standpoint of equality, that’s a major source of frustration for any reasonable taxpayer. He or she must cut coupons, corners and family budgets in order to pay for increasingly painful health insurance and property tax bills, while others are receiving, with minimal effort, Cadillac coverage at Cadillac prices.

But above and beyond the concept of fairness, there’s the issue of fiscal responsibility. How can that same penny-wise New Yorker and the elected officials he or she puts into office take seriously the extravagance – if not waste – of our Medicaid program? Should it really be 4 or 5 times more expensive than private insurance? The answer is “no”.

Albany politicians have been talking about Medicaid reform for years, all of them to a man knowing that the system is broken. Yet, the talk has been nothing more than that. If anything, reform has been in the wrong direction, actually lessening strict eligibility requirements and adding even more pricy gimmicks. Not surprisingly, the cowardice to initiate appropriate change wasn’t eliminated by the Great Recession and our dire fiscal situation.

So, just how do we change Medicaid and New York State for the better? There is a very simple means to do so, one that would be a win-win for both sides of the aisle (those who demand cost cutting and those fearful of “hurting” Medicaid recipients): Dissolve New York’s corrupt Medicaid system and redirect Medicaid funding to the purchase of private, not public, medical insurance.

The savings would be astronomical. The state’s Medicaid budget for 2010-2011 is approximately $52 billion. If HMO coverage were purchased, the state would save $39 billion per year and it would totally eliminate the burden that is placed on the counties; gone would be the sales and property taxes specifically set aside for Medicaid.

Residents and businesses would have $39 billion of their own money made available to them every year, allowing them to spend and save and do as they wish with it, pumping it into more-productive sectors of the economy which in turn would increase personal wealth and employ more people (taking them off the Medicaid rolls in the process), making New York a place that’s attractive to live and work. Economic development and good government can really be that simple and moral: You actually can dramatically cut costs in entitlement programs without adversely affecting those deemed to be in need.

To make such an idea come to fruition you’d need a buy-in from Albany. They would have to be willing to totally remodel state government and eliminate layers of bureaucracy. If Andrew Cuomo is any bit the reformer he claims to be, it would be the perfect task for him. If the voters are as angry as they say they are, he’s got the backing.

One obstacle might be the federal government. Medicaid clearly defines minimum expectations and requirements, all of which are met by HMO. The feds might not see it that way, but any attorney-general worth his salt can make a very compelling claim to Washington. Look at how many attorneys-general have raised a stink against Obamacare, something that has far less of an impact on the health care landscape than Medicaid. If only one of them - ours, I hope - could take the risk and take on Lyndon Johnson’s ever-lasting Medicaid nightmare, our state – no, our country - would be a much better place.

No comments: