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Status quo on Medicaid leaves state behind

St. Dominic Hospital has proposed building a $121 million Madison hospital campus, transfering 71 of its Jackson beds. St. Dominic’s would then expand other services at its landlocked Jackson campus.

Where have you been?

That’s a question Mississippi’s hospital executives should have to answer as the Legislature winds down and Republican leaders in both houses refuse to think pragmatically about expanding Medicaid under the federal Affordable Care Act.

The hospital CEOs and the Mississippi Hospital Association seem to have been largely absent from the wrangling in the Legislature in recent weeks over accepting hundreds of millions in federal dollars to expand Medicaid coverage to about 300,000 of the state’s uninsured working poor.

Alas, the hospital sector has decided to at least make a cameo in the Medicaid expansion debate. Executives from Mississippi’s hospitals will assemble Monday at the Mississippi Hospital Association headquarters in Madison to begin what could be a belated push to win over hearts and minds of GOP legislators.

The association has not done an in-depth analysis of how Medicaid expansion would impact the fiscal health of hospitals in the state. Nor has it taken an in-depth look at the consequences of losing federal money for indigent care that the Affordable Care Act has slated for replacement through Medicaid expansion.

But its neighbor-state counterpart, the Arkansas Hospital Association, had George Washington University and Regional Economic Modeling Inc. do an analysis for its state. Released this week, the Arkansas study says expanding Medicaid eligibility would result in a $664 million net savings to the state over the next several years and create 8,600 new jobs in 2014 and 10,600 new jobs by 2020.

With an economy and demographics similar to Arkansas, Mississippi could expect a similar impact.

Indeed, a senior Mississippi’s state economist projects an annual additional injection of $800 million to $1 billion into the state’s economy through the federally sponsored expansion. Taxes the state collects on that extra money coming into the economy will go a long way toward covering the state’s estimated cost of $95 million in 2025.

Incidentally, the $95 million would be reached after surpluses of $9.2 million in 2015, $20.2 million in 2016. Only in 2017 would the balance shift, with the state taking on a burden of $2 million in 2017 and $30 million in 2019 before gradually reaching the $95 million level in 2025, the state study projects.

Now that the men and women who run hospitals around the state have decided the stakes are sufficiently high to merit their involvement, they must try to convince state leaders, including Gov. Phil Bryant and Lt. Gov. Tate Reeves, to substitute pragmatism for ideology on the Medicaid expansion issue.

Obviously, the distrust (or even disgust) state elected leaders have with Washington has prevented a look at the practical side of the Medicaid expansion issue, both in terms of revving up health care as an economic engine and enhancing the health and quality of life for a huge part of the population.

Gov. Bryant insists the state is better off with a status quo in which he concedes hospital emergency rooms are the primary source of health care for the state’s uninsured working poor.

Under the status quo Gov. Bryant prefers, Mississippians who have health insurance are covering the cost for hospitals to treat the uninsured. That burden, which also falls heavily on employers who pay a sizable share of the health insurance premiums for their workers, is certain to rise with rejection of the federal offer.

This is an offer, by the way, to cover Medicaid expansion at 100 percent for the first three years and up to 90 percent in the years that follow. With rejection of the offer comes the elimination of $152 million Washington gives the states hospitals to treat the uninsured.

State officials say they don’t think the federal government will actually follow through on withdrawing what is known as the Disproportionate Share Hospital, or DSH, payments. But the way the Affordable Care Act is written, federal officials have no choice but to cut off the money. The money, after all, was to be replaced by the hundreds of millions of the dollars states are to receive for expanding Medicaid to cover people with incomes of 138 percent of the federal poverty level.

Elimination of the DSH payment is “hard-coded” in the Affordable Care Act, says Gwen Combs, Mississippi Hospital Association VP for policy.

Likewise, resistance to growing the state’s Medicaid rolls is “hard coded” into the minds of Mississippi’s elected leaders. Hence, we expect the state will remain in the holdout column as the 2013 Legislature adjourns.

There’s always next year, though. So let’s hope the Mississippi Hospital Association and the medical executives who make up its membership will get an early start on explaining the true consequences of keeping Gov. Bryant’s beloved status quo.


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