Unequal Outcomes

To get off of Afghanistan for a bit, I recently ran across a New York Times article from September 15, "A Party Conflicted". Its subject was how an expansion of Medicaid, a vital part of achieving near universal coverage, in practice gave more federal money to the states that offered Medicaid to the least number of people.
Under the proposed health care legislation, new federal money would go to states to help pay for newly eligible Medicaid enrollees. And a higher percentage of those who would be newly eligible live in states that so far have made it hardest for people to qualify for Medicaid.

Alabama, for instance, sets its eligibility cutoff for parents at 11 percent of the federal poverty level. That means that a couple with two children qualify for Medicaid only if they earn less than $2,425.50 a year. A couple earning more are not considered poor enough to qualify.

Compare that with the Medicaid cutoff in more generous states, most of them traditionally blue. Medicaid is offered to parents earning 100 percent of the poverty level in California; 150 percent in New York; 185 percent in Illinois; 200 percent in Maine, New Jersey and Wisconsin; and 275 percent in Minnesota.
Medicaid mapThe federal poverty level for a family of four is $22,050, so Minnesota offers Medicaid to those families making less than $60,000. Not all those families will take it, but it's there for those without health insurance offered at work or with pre-existing conditions.

As you might have guessed, the least generous states correlate with the most conservative states. Senator Richard Shelby (R-AL), do you oppose offering Medicaid to a family of four who earns $3,000 a year? Or would you rather send their ER bills to all the people in your state with private health insurance?

The real debate we're missing and an apology to Senator Shelby after the jump.

UPDATE: Although the focus of this story, "Majority Leader Protects Home State", rightly calls out the typical Senate shenanigans - trying to jerry-rig the federal vs. state costs of the expansion of Medicaid - it contains a huge issue for the operation and overall cost of the program as stated in this sentence:
The Senate bill, like a companion measure in the House, would expand Medicaid to cover childless adults, parents and other people with incomes less than 133 percent of the poverty level, or $29,327 for a family of four.
That simple threshold is a vital issue to the entire reform. Below it, the federal and state governments will be paying for Medicaid. Above it, federal subsidies will be spent to purchase insurance on the health exchange. Just as important is the sliding scale of subsidies. Considering the situation of a family of four with $30,000 of income, I'd imagine they would get a 100% subsidy. And I hope the threshold to end the complete subsidy wouldn't start until say $50,000 and the scale would rise slow enough that the vast majority of each extra dollar of income would not go to health insurance. But I've never heard this discussed. I trust that we'll hear more about it as we get down to brass tacks, but this is the huge downside of President Obama's choice to be hands off.

Also, it wasn't fair to call out Senator Shelby for Alabama's stinginess. He hasn't even been in state government since 1978. So, sorry Senator. Alabama residents and the state's constitution are responsible. In 2003, the newly-elected Republican Governor, Bob Riley, tried to make the sales-tax-dependent tax burden more progressive, but the measure, called Amendment One, was rejected by 68% of voters. While it was an amendment, is certainly wasn't the first. Alabama's Constitution, at 357,157 words, is the longest operative constitution in the world because of its 798 amendments. Get this:
[Alabama] counties cannot even legislate on local issues, requiring the state legislature, and ipso facto uninvolved parts of the state, to pass local laws. The constitution addresses many issues that are dealt with by statute in most other states. The most notable issue is taxation. Unlike most other states, a large portion of Alabama's tax code is written into the constitution. Besides prohibiting local governments from passing any ordinances on tax issues, this necessitates its amendment over minor taxation issues. This, along with the requirement that an amendment must be unanimously approved by the legislature or face a statewide vote, has resulted in local county or municipality related amendments being overwhelmingly approved, but ultimately rejected statewide.
And I thought California was dysfunctional.

2 comments:

T.O.M. said...

Good catch of an important fact. The federal system permits, even encourages, these kind of little-known anomalies. One wonders what, other than a "red" political philosophy, would cause a state of seek to reduce the number of its citizens eligible for this benefits.

Norwegian Shooter said...

Thanks. I think there is a sharing of Medicaid costs between states and the feds. So it's the "low taxes-low services" states that set low eligibility thresholds.

I added a link to a longer version of the story from the NYT Prescriptions blog. It also includes a map/chart of the states.