Along with a growing effectiveness against all sorts of once-deadly illnesses, American medicine continues to lead the world in costs as well as benefits — and because of Louisiana’s large population of the poor, the expense of miracles is particularly high for state government.
Spending on Medicaid, the state-federal health insurance for the poor, has increased more than 51 percent during the years of Gov. Bobby Jindal’s two terms, despite the governor’s efforts to rein in costs.
The problem will be vexing for Gov.-elect John Bel Edwards but not because of any hostility to Medicaid as a program. Edwards favors a sensible expansion of Medicaid coverage, up to 138 percent of the poverty line or about $33,000 a year in income for a family of four.
That expansion is paid for by the U.S. government at rates of no less than 90 percent. Today, the state gets a 62 percent match rate for Medicaid under the old rules, before the federal Affordable Care Act. In reimbursement terms, that is too good a deal to pass up.
Still, it’s paying for health care, one of those items in everybody’s budget — from that of a household, to that of businesses, to that of the state — that continues to grow in most places well above the rate of inflation.
Cutting the payments to providers is hardly an option, given that access to care is important. Neither the state, nor the federal government that oversees the Medicaid program, wants to see providers turn away Medicaid patients.
It’s also true that doctors, hospitals, pharmacists and other providers of health care are influential lobbies in the State Capitol. Edwards, a two-term state representative, is aware of the limits of his freedom of action in these kinds of fights.
Nevertheless, we urge him to look hard at ways to cut costs.
The governor-elect is right to point out that the state has, under Jindal’s watch, changed the Medicaid program significantly in an effort to control costs. Legislators have sometimes been befuddled at hearings to determine whether we’re getting big savings from managed care companies, now enrolling most Medicaid recipients — except those at nursing homes, a large percentage.
Whatever the provisions of Medicaid expansion, the reality is that health care is expensive, and the poor don’t have money to pay.
It is an entitlement program: “The problem is if you are Medicaid-eligible and you utilize those services, the state has an obligation to pay for it,” said Lt. Gov. Jay Dardenne, who takes over as commissioner of the Division of Administration — Louisiana’s budget office — on Monday when Edwards is inaugurated.
As in other areas, government is making up for deficiencies in Louisiana’s economy: A large percentage of poor families is a driver of costs in Medicaid.
Those factors are not going to magically change because a new administration is coming into office. But a searching examination of the expenses for Medicaid might yield some additional savings to make the jobs of Edwards and Dardenne a bit easier.