Contradictions abound as feds, state confront regime change

Published 4:08 pm Wednesday, January 11, 2012

When it comes to getting a handle on government spending on public health care, it’s the same in Jackson in many ways as it is in Washington. Why?

The members of both the Mississippi Legislature and Congress are presented with mixed messages in the political arena when it comes to really getting handle on the big ticket items like public health care. Despite their lack of statutory ability to really do anything about federal public health care policy, many of the new state legislators in Jackson got there because they tapped into voter angst and anger over “Obamacare” and runaway federal entitlement programs.

To be sure, the U.S. House Republican majority is struggling with those issues. When seeking election in the 2010 midterms, many successful GOP challengers now serving in Congress ran effectively against Obamacare and the sheer cost of the plan. Yet in the fall, the new Congress was confronted with the question of the Medicare drug benefit that was a creation of the GOP during the first term of former President George W. Bush. The plan, unlike much of government health care, isn’t that hard to explain.

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Medicare recipients pay only one-fourth of the actual cost of the drug benefit. Yet since there’s no dedicated tax to support the drug benefit, the other three-fourths of the drug benefit is paid for by the taxpayers with no offset.

First in Iowa and later in New Hampshire, the GOP presidential contenders have taken a pass on cutting the Medicare prescription drug benefit or enacting a funding mechanism for it. Even Libertarian Ron Paul — who voted against the benefit — has said repeal of the Medicare prescription plan “isn’t high on my list.”

In Jackson, new lawmakers found voters ready to embrace their campaign platforms that preached fiscal discipline. But over the last 40 years, Mississippi lawmakers have routinely authorized a more expansive Medicaid program that they’ve funded with state dollars — opting instead to push the maximum costs onto federal taxpayers.

The Haley Barbour administration tried, with mixed success, to shift as much of the more expensive Medicaid care — which required state matching dollars — to Medicare programs in pursuit of that very cost shifting strategy. Over the last eight years, Barbour’s face-to-face Medicaid reauthorizations and other initiatives had trimmed the state’s Medicaid rolls before this protracted recession and the 10 percent unemployment that came with it drove more Mississippians back onto the Medicaid rolls.

Yet few issues generate more pushback from constituents than Medicaid cuts — particularly when those cuts impact the elderly in nursing homes or children. More veteran lawmakers will tell their new colleagues that many constituents come to state legislators seeking help with their Medicare and Social Security, despite the fact that those are both federal programs.

In the 2012 federal elections, debts and deficits and Obamacare remain top drawer issues. But cutting or providing a funding source for the Medicare prescription drug benefit remains politically dangerous — particularly in poor states. Walking that line — between serving constituents already dependent on such benefits and installing fiscal discipline in the programs — will be a challenge for federal lawmakers.

In Jackson, the challenge is funding Medicaid at a time of legitimate increased demand that just happens to coincide with a period of stagnant state revenue. How big a challenge do state lawmakers face?

Medicaid in Mississippi is nearly a $5 billion annual proposition utilizing both federal and state dollars. It is also the most heavily-subsidized Medicaid program in the nation. In the fiscal year that ended June 30, 2011, for every $1 the state spent on medical care for the poor, the federal government spent $5.61. In the current fiscal year that began July 1, 2011, the ratio dropped to $3 in federal funds for every $1 spent in state dollars.

In 2014, the Obama health care reforms will require states to provide Medicaid to all those who earn up to 133 percent of the federal poverty level.  Think state lawmakers aren’t watching the presidential primary debates? Think again…

(Sid Salter is a syndicated columnist. Contact him at 601-507-8004 or