The Price Tag for Health Care

On January 12th, 2016, John Bel Edwards sat down at his desk on his second day of office as Governor of Louisiana. His predecessor Bobby Jindal had depleted the state budget (which prior was experiencing a rare surplus) to a $2 billion deficit. Edwards signed an executive order to allow an influx of $184 million in federal dollars to the state economy, as part of the Affordable Care Act (ACA). The ACA had been passed, Louisiana was subject to it, Jindal just refused to accept the money. As Edwards said, “the easiest decision I will ever make as governor.”


Fast forward to a year and a half later, and Edwards is struggling to hammer out his 2017 budget in the state legislature. The proposed $28.6 billion budget was eventually passed, and Medicaid accounts for roughly half of the state’s budget ($13.4 billion) in Fiscal Year 2017 (FY17). For a state that is still struggling to balance its decimated budget, that seems like a lot of state dollars for health care. In actuality, state dollars account for only 26 percent of Louisiana's Medicaid programs. The federal government funds 74 percent of the state's Medicaid program, and it’s pretty much no-strings-attached. The only stipulations require where the federal dollars are spent—with the focus being on children. In fact, 97 percent of the Medicaid budget used on children in Louisiana comes from the federal government.


Fast forward to early Thursday (6.22) afternoon. The Senate health care bill is unveiled. It hardly differs from the House bill that slashes federal dollars awarded to states to fund Medicaid expansion in order to cut taxes for a fraction of the top 1 percent of American earners. After a bill passes the House, it is sent to a non-partisan group of the most respected economists in America — the Congressional Budget Office (CBO). The CBO found that this bill would cut over one trillion dollars from the ACA. It would also reduce to average earnings of American workers for a combined total of $992 billion by reducing their ability to work, due to the inability to treat illnesses and health conditions coupled with their inability to meet rising health costs. In total, the bill is expected to cost the U.S. economy $119 billion, while transferring wealth to a billionaire cohort. 


After being shrouded in secrecy due to a bill that prevented even the secret Republican committee designated to create the bill from seeing it — instead, only a group of five, including Senate Majority Leader Mitch McConnell included, to see it —McConnell unveiled the bill.


According to the Senate Majority Leader, this bill would "shift power from Washington to the states so they have more flexibility to provide more Americans with the kind of insurance option they actually want.” What exactly is this shift in power? He is referring the roughly trillion dollars in Medicaid funding provided to states by the federal government. This is akin to an employer awarding a steffer with more responsibility by slashing their pay in half — a gross misrepresentation of how this bill threatens to not only decimate economies dependent on federal dollars (like the Louisiana budget), but of the millions of Americans that will suffer and die if this bill passes the Senate. Plainly put, McConnell plans to shift power from Washington to Louisiana by gradually defunding $10 billion from Louisiana’s economy (that’s like 5 Bobby Jindals, y’all).


So other than economically, why is Louisiana more disproportionately affected by the Senate Health Bill? The Boot is so highly affected by the Senate Health Bill because its just about the most unhealthy state in the U.S. Last year's Louisiana Health Report Card stated that the state ranked 46th best in terms of cardiovascular disease, 45th best in terms of adult obesity, 45th best in terms of adult diabetes, 47th best in terms of cancer related deaths, 44th best in terms of teen pregnancy and birth rates. At the largest conventional indicator of evaluating conditions for child-health, low birth-weight for babies, Louisiana ranked 49th. Additionally the Boot is the 12th most common state in terms of an individual dying of suicide or violent death, and the state manages to have more opioid prescriptions than we do residents. If you think that Medicaid doesn’t have a huge impact —consider that about 1.5 million people (or 32 percent of LA residents) are covered by Medicaid, and that most of these statistics represent factors that disproportionately affect the poorest third of society.


This bill threatens not just to kick many of Louisiana’s poorest out of health care, but it promises to further stress the state economy. This bill is being referred to as the largest transfer of federal-to-state dollars in the history of the United States, and Louisiana may suffer from this bill more than any other state. The bill is yet to be voted upon in the Senate, and with Rand Paul saying it is too liberal, McConnell does not have more than 51 votes. That means that if two Senators decide to pull out from the bill because it harms their constituents, the bill we be struck down. It actually looks as if it lacks the support to pass. Both Senator Cassidy and Senator Kennedy have not expressed their allegiance for this bill, instead deferring to “study it further.”


In addition to slashing health care benefits, this bill will cut infrastructure, public transportation, and law enforcement funding as the state will struggle to make up the enormous deficit in health spending. If you like any of those things, you are strongldy urge to call your Senator. Stayed tuned with NoDef for further coversage of this issue as it makes (or doesn’t) its way through the Senate.

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