Scoppe: In a rational world, SC wouldn’t still be debating Medicaid expansion

The State
April 28, 2015

Cindi Ross Scoppe
Associate Editor

You’d have to be crazy to pass a law that uses federal tax dollars to provide medical insurance to the working poor in some of our wealthiest states and not to those in our poorest states. You’d have to be crazy to pass a law that gives insurance subsidies to people who make more than a poverty-level income but leave those living below poverty out in the cold.

And in fact, while I do often wonder if practically everyone in the Congress isn’t crazy, no one passed such a law, at least not deliberately. But that’s the law we have as a result of a U.S. Supreme Court ruling that disappointed opponents of Obamacare by declaring it constitutional and disappointed supporters by declaring that each state could decide whether to expand its Medicaid program to cover adults who make less than poverty wages.

Even that wouldn’t be a problem if we lived in a rational world — a world where state officials made decisions on the basis of what’s best for their state, rather than on raw partisan calculations that have nothing to do with governance. But we don’t live in a rational world, and so South Carolina and a dwindling number of other states have refused to expand their Medicaid programs.

Even though the federal government is picking up the entire cost through next year.

Even though the federal government will still pick up 90 percent of the bill once it shifts part of the cost to states.

Even though a single state’s refusal to expand Medicaid is not going to make a noticeable difference in the federal deficit or debt or the rate of taxation or spending at the federal level.

Even though every one of us who has medical insurance is paying higher insurance rates to cover all the care that federal law requires hospitals to provide whenever the uninsured go to the emergency room rather than a less-expensive alternative. And by “less-expensive alternative” I mean anywhere other than the emergency room.

No one could have reasonably expected the Legislature to suddenly come to its senses just because a bipartisan group of senators and a left-leaning coalition of advocacy groups raised the issue once again this month, proposing a work-around that would use Medicaid funds to help purchase private health-insurance policies to cover the 200,000 South Carolinians who already would be covered if they lived in Oregon or Connecticut or another wealthy state.

But that doesn’t mean those senators and those advocates are wrong. They’re absolutely right. The Legislature should find a way to use the Medicaid program to cover the working poor, rather than keeping Medicaid coverage in our state limited primarily to pregnant women, children, parents of young children and the disabled.

If you set aside the moral questions — which are considerable — and focus only on the economic issues, it’s difficult to justify the status quo.

Gov. Nikki Haley and a lot of Republican legislators say our state can’t afford to expand Medicaid, because we would have to spend $57 million in 2017, increasing to $153 million in 2021. What they leave out is the fact that in return for that extra state spending, the federal government would send $1 billion in 2017, increasing to $1.4 billion in 2021. What they leave out is that the extra federal spending will create more jobs, for doctors and nurses and pharmacists and all the support people who work in doctor’s offices and hospitals and rehab centers, and that will produce spin-off jobs when those people with new jobs buy groceries and clothing and houses and other goods and services.

This is where you might want to recall that Gov. Haley and a lot of Republican legislators — quite correctly — consider having more people working to be a huge benefit in itself, aside from all the extra money the state collects in income and sales taxes when those additional people are employed and purchasing more taxable goods.

It shouldn’t surprise anyone that the state would benefit financially from expanding Medicaid: Although the Medicaid program always has required a state match, it always has been set up in a way that makes it in states’ best economic interest to accept that match. And our state has always done that, every time the federal government gave the go-ahead to expand Medicaid benefits; it’s just that we’ve usually waited until lots of other states already did it, thus losing out on some of the benefit. That loss caused by delay is even greater in this case than it has been in the past, because of the even-larger-than-normal match the federal government is putting up.

One study projected that expanding Medicaid would generate more tax revenue than the state would spend during the phase-in period. That probably wouldn’t hold up now, since we’ve already blown a year of the no-cost expansion and are in the process of blowing the second as well — advocates say we’ve rejected $4.7 million per day since Jan. 1, 2014 — but it does suggest that much of the cost of expansion would be offset by all that extra money. Which is just common sense.

Sort of like expanding Medicaid is just common sense.

Ms. Scoppe can be reached at or at (803) 771-8571. Followe her on Twitter @CindiScoppe.

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