Texas is thinking of abandoning Medicaid, reports the New York Times, reprinting a story from the Texas Tribune, a colorful piece that omits one central fact about Medicaid expansion under the Affordable Care Act (ACA).
Apparently the state’s conservatives are unhappy that reform legislation will open Medicaid’s doors to millions of Texas. Today, in the Lone Star state, parents qualify for Medicaid only if their family income is below $5,720. The legislation would set a new national standard for Medicaid eligibility at about $28,000—or $33,000 for a family.
“Dropping out of Medicaid is worth considering,” State Senator Jane Nelson, who heads the state’s Senate Public Health Committee, told the Tribune. “Currently, the Texas program costs $40 billion for a period of two years, with the federal government paying 60 percent of the bill,” but “as a result of federal health care changes, millions of additional Texans will be eligible for Medicaid. I want to know whether our current Medicaid enrollees, and there certainly could be millions more by 2014, could be served more cost efficiently and see better outcomes in a state run program.”
According to the Tribune, “Far-right conservatives are offering that possibility in impassioned news conferences. Moderate Republicans are studying it behind closed doors.”
The story also quotes State Representative Warren Chisum, Republican of Pampa, “the veteran conservative lawmaker” who recently entered the race for speaker of the House: “With Obamacare mandates coming down, we have a situation where we cannot reduce benefits or change eligibility” to cut costs. “This system is bankrupting our state. We need to get out of it. And with the budget shortfall we’re anticipating, we may have to act this year.”
Always ready to be of help, “the Heritage Foundation, a conservative research organization, estimates Texas could save $60 billion from 2013 to 2019 by opting out of Medicaid and the Children’s Health Insurance Program, dropping coverage for acute care but continuing to finance long-term care services.” The Texas Health and Human Services Commission, which has 3.6 million children, people with disabilities and impoverished Texans enrolled in Medicaid and CHIP, will release its own study on the effect of ending the state’s participation in the federal match program at some point between now and January.”
What the Stories Don’t Mention
Under the Affordable Care Act, it is true that the ranks of those eligible for Medicaid will swell, beginning in 2014. But for the first few years, the federal government will pay 100% of the cost of covering new enrollees. Granted, beginning in 2020, Washington pares back its help– but still pays 90% of the bill.
As Austin Frakt, who blogs as The Incidental Economist observes, “to blame Obamacare for the cost of new eligibility now and in the next few years is completely wrong.”
Do the State Senators and Representatives who are quoted really not know that the federal government is picking up the tab?
In fact, Texas will benefit more than most states: “States that offer modest coverage today—Alabama, Arkansas, Mississippi, Oklahoma, South Carolina, and Texas—will see very large overall federal” spending, the Urban Institute explains, accompanied by “relatively small increases in their own spending, both because they are low‐income states and thus have higher than average matching rates on their current eligibles, but also because of the very favorable matching rate on new eligibles.”
Texas can expect to see Medicaid enrollment rise by 46 percent while state spending on Medicaid rises by about 3 percent. Meanwhile, Federal spending in Texas is expected to increase by 39 percent. And as more Texans join Medicaid, the state’s hospitals will no longer be forced to “eat” so many unpaid bills. Granted, Medicaid reimbursements are low, but some payment is better than no payment. Moreover, under the Affordable Care Act, reimbursement for primary care will rise to Medicare levels.
Across the nation, the Urban Institute reports, the federal government will pay a very high share of new Medicaid costs. Overall, federal spending on Medicaid will rise to $443.5 billion while state spending increases by $21.1 billion between 2014 and 2019. Thus about 95 percent of all new spending would be by the federal government.
Why Not Correct the Story?
What I cannot entirely understand is why the New York Times featured the piece without comment. I realize that the idea of Texas dropping Medicaid and SCHIP provides a sensational headline on a slow Saturday. And I know that newspapers—including the Times—are under enormous financial pressure. This is why they need stories from other sources.
In a box that accompanies this piece, the Times explains its new relationship with the Texas Tribune: “Expanded coverage of Texas is produced by The Texas Tribune, a nonprofit news organization.” Going forward, the Tribune will be working with the Times to produce in-depth Texas coverage. The twice-weekly features will be known as “The Texas Report” and will appear on a “dedicated” New York Times page. Some suggest that by working with non-profit news organizations like the Tribune, the “mainstream media” may “rehabilitate” its partisan image. According to critics of the mainstream press, “the perceived or real bias comes . . . from the pervasive liberal outlook of the writers and editors producing the content” at newspapers such as the Times. Presumably, if the Times had mentioned the fact that state spending on Medicaid will climb by only 3 percent—while federal Medicaid dollars pouring into the state will rise by 39 percent—the paper would have been accused of putting a “liberal spin” on the story.
Whatever value the Tribune may add to the NYT’s Texas coverage, facts are facts. It would have been helpful if the Times had added an editor’s note to the piece—or called the reporter, and suggested a revision.
Instead, the Times is helping to broadcast the misinformation that Texas conservatives are putting out there. And in the blogosphere, the suggestion that reform legislation will bankrupt the states spreads.
Bogus Story Serves to Confuse the Public
Conservatives like to bluster. But in truth, it would make absolutely no sense for Texas to shed Medicaid. Even if a state program proved to be miraculously more efficient than a federal program, and even if Texas slashed Medicaid benefits, it could never save enough to make up for the loss of federal aid which covers 60% to 100% of costs.
As Frakt observes: “Those who talk about dropping out of Medicaid also seem to have forgotten that for all their complaining, hospitals and physicians do accept a fair amount of money from Medicaid. That would all disappear . . . Let’s not ignore the fact that Texas already has the highest rate of uninsurance in the country. Think this will help?” It would devastate the health and well-being of that already disadvantaged population.” (Over 26% of Texans have no insurance.)
He admits worrying that “they may be serious” (we are, after all, talking about Texas), but in the end sounds pretty sure that all of the talk is “just posturing and saber-rattling.”
This is why Frakt titles his post: “Is This Story for Real?” By contrast, the Times ran the piece as a straight news story headlined: “Texas Considers Medicaid Withdrawal.”
But if you read the article closely, you will find that the Texas Tribune itself hints that this is all political theater. In the second half of a sentence buried at the end of a paragraph, the paper reports: “The party’s advisers on health care policy say [that dropping out of Medicaid] is being discussed more seriously than ever, though they admit it may be as much a huge in-your-face to Washington as anything else.”
Exactly. Texas politicians are blowing smoke. But they have a serious purpose. By spreading the rumor that moderates are meeting behind closed doors to discuss dropping out of Medicaid and SCHIP, they gain a wide audience—and a unique opportunity to spread another Big Lie about the Affordable Care Act. (I don’t believe, for a minute, that the Texas legislators who were quoted don’t know that Washington will be picking up the tab for new enrollees.
Expect more stories like this one. In Congress, and across the nation, those who oppose reform will use whatever platform they can find to issue threats and stir fears of “unintended consequences.” There is not much that they can do to stop the Affordable Care Act over the next two years. But they will continue the attack, grandstanding, and using the media as a stage where they can blur the facts.
The public doesn’t have the time to read the bill. Journalists and bloggers will have to be dogged, correcting the half-truths and outright lies that we will be hearing on cable, in the blogosphere—and even in Congressional hearings.
It is tragic that, at such an important moment for the nation, so many newspapers and magazines don’t have the resources to stay on top of the story—and that so many talented, experienced, truth-telling reporters have joined the ranks of the unemployed.