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March 2013 Policy Study, Number 13-3


Just Say NO – and Keep Saying NO – to Federal Health Care Exchanges and Medicaid Expansion


Experience in Arizona and Maine



Importantly, there is factual evidence of what might happen in Iowa and other states. A report by the Foundation for Government Accountability reviews the results of states that have already expanded Medicaid, particularly in Arizona (Proposition 204) and Maine.


These are real numbers, from real experiences – not hypothetical guesses. It shows that none of the expectations and promises concerning the reduction in the number of uninsured, gradual enrollment increases, low and predictable costs, and reductions in the amount required for charity care have held true.


Instead, in Arizona enrollment expansion was higher and faster (3 times higher) than predicted, yet the number of uninsured either remained the same or actually increased. Costs for the newly covered were higher than for those already enrolled, especially for the childless adults added to the rolls, which were twice as high as projected.


Total costs in Arizona have been four times as high as expected.[39] The jump in enrollments and costs were especially significant from 2008 on, as the recession impacted employment and health outcomes.


Maine, which started to cover childless adults in 2002 under a special waiver from the federal government, has seen similar results.


Enrollment projections were for about 11,000. The number immediately went to over 17,000 and has now been capped at 11,000 with a waiting list of over 24,000 more.


The costs for childless adults have been massive, averaging over $5,000 per year, per person – even with usage limits on prescription drugs, out-patient visits, and mental health and drug/alcohol abuse coverage.


Families with children, in comparison, cost from $1,200 to $2,500 per year, less than half.[40] The state is simply unable to afford the costs incurred.


This pattern has repeated itself in Delaware, Michigan, Oregon, Utah, Vermont, and Washington, D.C., following similar expansions of their programs.[41]


While many of the supporters of the PPACA express concerns about access to and costs of health care for children and families, the real users (and it might be said – abusers) of Medicaid are single, childless adults.


Though the Foundation for Government Accountability report does not delve into the reasons for such high utilization of health care, other reports indicate that much of the cost is driven by drug and alcohol abuse and resulting emergency room visits.


There is no indication that government – taxpayer-funded – access to medical services is actually solving the health problems. Further, by removing personal accountability and cost impacts from the use of these services, there is no incentive for the individuals to control or reduce their use.




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