Ken Hare In Depth: Bentley sidesteps way to boost economy and health

MONTGOMERY, AL (WSFA) - As governor of Alabama, Robert Bentley promised to make an improved economy that would create jobs the watchword of his time in office. As a physician, Bentley has an obligation to work for improved health for those in his community.

But Bentley steadfastly has refused to allow Alabama to take part in a federal program to expand Medicaid to some 300,000 Alabamians, despite the belief of many experts that such a move would both boost the state's economy and the health of hundreds of thousands of its people.

Economists estimate that such an expansion, which would be paid for almost entirely with federal dollars, would have a $20 billion economic impact in Alabama.

The Medicaid expansion would come under the federal Affordable Health Care Act, popularly called Obamacare. Bentley is one of the GOP governors who say they would not allow the expansion in their states.

If Alabama went along with expanding Medicaid under the federal Affordable Health Care Act starting in 2014, the federal government would assume almost the full cost of the expansion through 2016. The state would have to start assuming a larger share of the cost after that, but the state's share would top out at 10 percent starting in 2020.

While the federal government would cover 100 percent of actual health care expenditures from 2014 through 2016, Alabama would be responsible for a share of administrative costs amounting to about $39 million a year.

The total cost to the state through 2020 is estimated at about $771 million. During that seven-year span, the federal government would pump an additional $11.7 billion into Alabama health care.

Or look at the program over the next 10 years. According to the Kaiser Commission on Medicaid and the Uninsured, Alabama would spend about $1 billion for the expanded Medicaid coverage while getting about $14 billion in additional federal support. After 10 years, the state would get $10 for every $1 invested.

If an industry was promising to pump that much money into Alabama's economy -- money that could create 12,000 new jobs by 2016, according to one study -- the governor and legislators would be falling all over themselves trying to find the incentive money to make it happen.

But this is Obamacare, and therefore it is rife with politics.

Bentley says that it isn't politics pushing his decision; he told WSFA reporter Max Reiss that the state simply cannot afford its share of the cost of expansion.

But a study by two respected economists at the University of Alabama Birmingham estimates that expanding Medicaid in Alabama would generate $20 billion in new economic activity, which in turn would generate $1.7 billion in new tax revenue for the state from 2014 to 2020.             So subtract the $771 million in state costs for the expansion from the $1.7 billion in new tax revenues, and state government revenues would come out ahead by almost a billion dollars, according to the study.

The economic benefits are clear, but the public health arguments for expansion are even more telling.

Alabama is, to put it bluntly, an unhealthy state. From year to year it bounces around the bottom half-dozen states in overall health rankings. It has the seventh highest rate of heart disease in the nation. It has the fifth highest rate of diabetes. It has the ninth highest cancer rate. It is among the worst in obesity. It has the fourth highest risk for strokes.             Expanding Medicaid would not address those risks for all Alabamians, but it could make a huge difference for the 300,000 or more who would be covered.

There are legitimate concerns about whether the nation can afford Obamacare in the long run. But it is the law of the nation now, and it is going ahead in most states whether or not Republican governors like Bentley agree to allow it in their states.

And that means that Alabama taxpayers will be paying their share of the cost of Obamacare whether or not Alabama goes along with it -- they'll just be paying for expanded care for citizens of other states, but not their own.

That's one reason several conservative Republican governors, including the governors of Arizona, Florida and New Jersey, have said they supported expansion in their states. They also cite the economic benefits of the expansion.

Alabama, of course, would not be unique in seeing economic benefits from Medicaid expansion. For instance, a study done by a professor at Georgia State University found that in Georgia, expanding Medicaid  would generate 70,000 new jobs statewide and give Georgia's economy an $8.2 billion boost each year. It would also increase state and local tax revenue by more than $275 million annually there.

There is one other possible option for Alabama -- one I touched on in a column last month. It is a way to dip into federal Medicaid expansion dollars without technically expanding Medicaid. In other words, a way to take advantage of some of the federal money while still allowing Republicans to deny they are going along with Obamacare.

Tennessee, Ohio and Arkansas are negotiating with the Obama administration over the possible use of federal Medicaid money to pay premiums for commercial insurance that could be used to purchase private health insurance for low income residents through regulated insurance exchanges.

Bentley told WSFA's Max Reiss that he would not rule out regulated insurance exchanges here as well.

Such exchanges would have their drawbacks when compared to a straightforward expansion of Medicaid.  Private insurance is almost always more costly than Medicaid. So that would mean either a cutback in the number of people covered or an increase in what the federal government and the states spend if they want to cover the same number of people. And the economic boost to Alabama would be watered down because much of the spending would be flowing to out-of-state insurance companies.

The potential economic and public health benefits of expanding Medicaid in Alabama are huge, but there really has been no widespread public debate and discourse on whether Alabama will take part. And that's probably because it's something proposed by President Obama.             The irony is that the state's second physician to serve as governor (William Wyatt Bibb, Alabama's first governor, also was a doctor) could be best remembered for denying access to health care to hundreds of thousands of Alabamians.

It would be shameful if the state's top elected officials -- not just Bentley, but the Republican leaders in the Legislature as well -- let partisan politics get in the way of providing health care and jobs for Alabamians.

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