• Jeff Fox: The business case for Medicaid

  • Expanding Medicaid in Missouri in line with the rollout of Obamacare over the next few years might sound like a political non-starter.

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  • Expanding Medicaid in Missouri in line with the rollout of Obamacare over the next few years might sound like a political non-starter.
    Republican leaders in the General Assembly have flatly dismissed the idea, and they have veto-proof majorities in the House and Senate. Washington would pick up the full cost at first and then drop to paying 90 percent in a few years, but Republican leaders say even spending $400 million over 10 years to get $8.3 billion from the feds is a bad deal.
    But consider two things before writing it off. First, Democatic Gov. Jay Nixon has committed his considerable political force to the idea. Second, proponents will argue that there’s a solid business case for bringing health insurance to another 300,000 people in the state. In fact, they point out, the Missouri Chamber of Commerce – a loud voice in Jefferson City – supports the idea.
    Or consider Charlie Shields, an Independence native who served as a Republican in the legislature from St. Joseph and led the Senate until term limits forced him out a few years ago. Now he’s the chief operating officer for Truman Medical Center-Lakewood, which serves much of Eastern Jackson County.
    Why is he on board? He said it’s the same idea he always had when he was in office: Do nothing to hurt businesses, nothing to hurt jobs.
    The argument is that businesses are already paying for health care – indirectly but substantially – as insurers shift costs.
    “The cost of uncompensated care is borne by businesses that provide health insurance for their employees,” Shields said last week when Nixon came to town to endorse the Medicaid expansion.
    So this move makes sense, proponents say.
    “It protects Missouri businesses. It protects Missouri jobs,” Shields said.
    More people with health coverage means more people getting care – more work for doctors, nurses and others – instead of holding out for expensive emergency room treatment that hospitals often end up writing off. The Missouri Hospital Association has a new study that says the change would mean 24,008 new jobs statewide in 2014, when the expansion would kick in, including 4,236 in Jackson County and four other metro counties.
    There’s one more piece. The federal money that hospitals get to help offset all that uncompensated care is going away in the next few years. The Medicaid expansion would, in theory, largely take care of that problem. Without it, hospitals might start closing. One local Democratic lawmaker told me once legislators around the state start hearing deep concerns from their hospitals back home, they might come around. Stay tuned.
    Economic snapshot
    The state of Missouri says general revenues in November were 6 percent higher than in November 2011. Much of that is sales and income taxes, suggesting that the state’s economy is doing OK.
    Page 2 of 2 - The breakdown:
    • For the first five months of the state’s fiscal year, general revenues are up 7.2 percent. General revenues account for about one-third of state spending.
    • Individual income tax collections were up 4.8 percent in November and – at $2.13 billion so far – are up 3.5 percent for the year.
    • Sales and use taxes were off 6.5 percent in November but are up 0.6 percent so far for the year, at $780.8 million.
    The Creighton Economic Forecasting Group isn’t so optimistic. It’s November Missouri Business Conditions Index – from a monthly survey of manufacturers – slipped to 47.2 for November, down from 50 in October. Anything above 50 indicates growth ahead, and anything below 50 suggests an economy that’s stalling. Missouri was last below 50 a year ago, in December 2011. It had climbed out of that, but then had drifted into the low 50s since late summer.
    Specifically, the Creighton Group sees weakness in new orders, production and inventories and only modest strength in delivery lead time and employment. For 2012, it says, the loss of jobs at companies making nondurable goods has more than offset gains at companies making durable goods, such as cars. Overall job growth is “likely to hover slightly below zero in the next three to six months,” the Creighton Group says.
    Jeff Fox is The Examiner’s business editor. Reach him at jeff.fox@examiner.net or 816-350-6313.

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