Testimony on SB 251 (Amendments to Medicaid and Health Care)

sutherland file pictures 008Testimony presented by Derek Monson, director of public policy, Sutherland Institute, on Feb. 27 before the Utah Senate Health and Human Services Committee regarding SB 251 – Amendments to Medicaid and Health Care:

Thank you Mr. Chair and members of the committee. I am Derek Monson with Sutherland Institute, and I am here to speak in opposition to SB 251. Thank you for giving me the chance to explain why.

At Sutherland we recognize the logic behind seeking to expand Utah’s Medicaid program per the vision of Obamacare. Utahns are paying taxes under Obamacare, so why not accept federal funding by expanding Medicaid in order to help Utahns in need, especially when the promise of that funding is so generous? When you focus on the short term, that approach – the path laid out by SB 251 – can make a lot of sense.

But when you expand your view to the long term, the logic for SB 251 falls apart. In part, this is because the “promise” of generous federal funding for expansion is really an empty promise. This conclusion becomes clear when you consider the U.S. Treasury’s own statements that federal spending policy “is not sustainable,” or when you consider that the long-term debt and financial obligations of the federal government, not even including Medicaid spending, are nearly equal to the household wealth of the entire country. Those facts become relevant to this discussion when you consider that Washington’s solution to these fiscal problems has been to cut spending to state and local governments – such as sequestration’s cuts to PILT funding – and to low-income Americans – such as the farm bill’s coming cuts to the food stamp program.

The logic for SB 251 also falls apart in the long term because of the risk that Utah taxpayers will not be protected when inevitable federal spending cuts happen.

Despite the well-intentioned language in SB 251 that repeals Medicaid expansion when those cuts happen, the actual federal law governing expansion makes it a permanent part of the state’s Medicaid plan and makes anyone covered by expansion a part of the mandatory coverage population. So while the U.S. Supreme Court gave Utah the option of not expanding Medicaid under Obamacare, it did not strike the language of Obamacare that could have the effect of making Utah’s Medicaid expansion permanent once we agree to it. And despite the reassuring views expressed by federal officials in non-binding letters, once Utah expands its Medicaid program under Obamacare, the state will be held to federal law and binding court rulings, not to non-binding letters from Washington.

Finally, the logic for SB 251 falls apart in the long term because it does not truly help those most in need in Utah. For example, the bill would create better coverage for single adults without children or debilitating health care problems than is available to disabled Utahns, single parents, and seniors that are left behind in Old Medicaid. To give you an idea of the potential size of this problem, 95 percent of uninsured individuals below the poverty line in Utah are non-parents who likely fit this description. The more generous provider payments available from the coverage created by this legislation is likely to compound the existing health care access problems that truly needy Utahns face in our current Medicaid program.

The lives and health of low-income Utahns and the well-being of Utah taxpayers are too important to trust to empty promises and non-binding letters from Washington, D.C. We encourage you to vote against SB 251. Thank you.

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