Gingrich: Plan will bankrupt states
Wednesday, October 28, 2009
It's one thing for Congress to spill red ink with no regard for the federal deficit, to print and spend money with no restraint.
Unfortunately, there is no law requiring the federal government to balance its budget the way you and I must balance a checkbook.
But the debate over an enormous health care entitlement has gotten so lavish, so out of control, that Congress is embarrassed to the point that it is searching to keep the spending spree below $1 trillion so it doesn't sound so bad to the American public.
Like $1 trillion is a bargain.
The latest scheme in the health care negotiations is to force states to increase the eligibility for those who qualify for Medicaid to 133 percent of the poverty level.
Translation: Millions more Americans who aren't in poverty would qualify for the Medicaid program paid for with federal and state dollars.
As a result, state governments struggling to balance their budgets would incur billions of dollars in debt to pay for these new patients needing health insurance.
It would be the largest unfunded mandate by the federal government in American history.
If the current proposal before Congress were to pass, 33 states would see a 30 percent increase in Medicaid enrollment, according to the Heritage Foundation.
Another 10 states would see their Medicaid population jump by 50 percent or more, including Texas by 76 percent, Florida by 54 percent, Colorado by 70 percent and Montana by 80 percent. Here in Missouri, the increase would be 35 percent.
In Texas alone, Gov. Rick Perry said new Medicaid patients would cost the state $4 billion a year.
States are struggling to balance their budgets and are shortening the school year, closing parks and furloughing or laying off public safety workers, teachers and other state employees to save money.
Adding more residents to their Medicaid programs, courtesy of the federal government, is not the way to construct health care reform.
No teacher would want to lose his or her job to pay for the health insurance of someone else.
What makes the United States a union of states is that we are a nation of unique needs.
In one state there may be a large population of Native Americans with distinct health care requirements while another state may have a growing number of senior citizens.
Some states have very healthy populations with residents that exercise and enjoy the outdoors. Others have high rates of obesity and greater incidents of smoking.
Because each state is different, Congress should not craft a health care solution that is one-size-fits-all.
By imposing tougher Medicaid rules and telling states how to manage their programs, it will not only bankrupt state budgets but make it likely those who use Medicaid won't get the individual treatment they need.
That's like telling all doctors the only cure for a stomach ailment is one medication and one medication alone.
That is the kind of medical malpractice the federal government is about to impose on all of us by requiring states to expand their Medicaid programs.
As Milton Friedman once said, "There is no such thing as a free lunch," and education, public safety and other critical needs will suffer as a result of this health care mandate unless states raise taxes. States can't run deficits.
Washington should find a way to pay for health care reform with simple measures such as malpractice reform, tax credits and enabling Americans to purchase health insurance across state lines.
But it is tone-deaf to any measure that saves money.
Meanwhile, Congress seems content to plow ahead with a bill that will make health insurance unaffordable for many Americans.
A new study by Oliver Wyman showed that, under the legislation passed by the Senate Finance Committee, family and individual health plans would soar 50 percent.
It also concluded that within five years the plan would force 19 percent of small companies to drop their health insurance coverage because of the onerous costs.
Billions of dollars of Medicaid requirements dumped on states, and at least $1 trillion in new spending by the federal government during the next decade.
Combined with the amassing federal debt, cuts to seniors on Medicare and 16 million remaining on the rolls of the uninsured, Washington is creating a Ponzi scheme that's sure to collapse.
All in the name of health reform that does nothing but create more fiscal instability.
Newt Gingrich, former speaker of the U.S. House of Representatives, is the founder of the Center for Health Transformation. Nancy Desmond is the center's CEO.