Expanding Medicaid rolls will harm market while burdening the public
State Department of Health and Hospitals Secretary Bruce Greenstein predicted disaster for the state’s health care system Wednesday in front of the Rotary Club of Baton Rouge. Specifically, Greenstein argued that the health care law will cause “cannibalization” in the private health care market.
Greenstein accurately observes that the state’s already overburdened and unsustainable Medicaid program will receive 467,000 new beneficiaries starting in 2014- a 40 percent expansion. Of those patients, 167,000 currently are privately insured. This amounts to reducing consumers in the insurance market, which could quite possibly result in some providers leaving the market altogether, and will certainly raise costs.
The implications of this could be catastrophic. As it is currently, Medicaid patients have trouble receiving care because the Medicaid market is so crowded and compensation for doctors so low. This problem will be exacerbated when 467,000 new people are crammed into the market, making access even harder to come by.
Louisiana’s long term finances will also be threatened. Medicaid currently consumes roughly 17 percent of all state level spending, more than both higher education and transportation. With an estimated $7 billion price tag over the first ten years, the state will inevitably have to allocate money from other critical programs towards the swelling Medicaid population.
Greenstein instead wisely advocates letting states develop health care plans which fit their unique needs, rather than have the federal government shift long term costs and top-down regulations upon states which cannot afford them. “Government-financed health care does not have to be government-run,” he contends. The dangers of the Obama health law have been well documented, and one can only hope Greenstein’s comments are given the consideration they deserve.