Oppose Nationalized Medical Insurance

The new Patient Protection and Affordable Care Act (PPACA) is a burden on Arkansas taxpayers, though executive branch officials are in denial about its budget exposure. Legislators need to understand that nationalized medical insurance, in the economic long term, will restrict their ability to fund services like public education that are required under the Arkansas Constitution.

The Obama administration has made nationalized medical insurance a priority. This policy creates budget exposure for states by expanding Medicaid coverage. States that border Arkansas have started the process of assessing the exposure. An econometric estimate conducted for Mississippi found the “total fiscal impact” during “the next 10 state fiscal years” to be in the range of approximately $0.9 billion to $1.7 billion depending on the actual level of participation by the eligible population.” (1) Texas officials concluded Medicaid expansion could cost the state up to $27 billion in a decade. (2)

Legislators should understand nationalized medical insurance includes “a deceptive funding mechanism” for added benefits. Three years of full federal funding are provided. But Arkansas and other states must shoulder a “larger burden of the benefit costs” of new beneficiaries starting in 2017.”(3)

Recommendations

· Arkansas budget exposure must be assessed by the legislative branch.

· Government should not design universal medical insurance. Instead, consumers should have access to a variety of designs. These include broadened Good Samaritan protection for serving patients at greatly reduced charge or no cost; tax credits or deductions for uncompensated service; various schedules of deductibles or copayments; and lifetime insurance provided by private or not-for-profit entities.

(1) “Financial Impact Review of the Patient Protection and Affordable Care Act As Amended by H.R. 4782, The Reconciliation Act of 2010, On the Mississippi Medicaid Budget,” October 1, 2010

(2) “Federal Health Care Reform-Impact to Texas Health and Human Services,” Texas Health and Human Services Commission, Executive Commissioner Thomas M. Suehs before the House Select Committee on Federal Legislation,” April 22, 2010

(3) Chen, Dr. Lanhee. “How Obamacare Burdens Already Strained State Budgets.” Heritage Foundation, November 10, 2010