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The Obama health care initiative will be the biggest unfunded federal mandate on the states in history. It will force dozens of states, particularly in the South, to abandon their low tax ways and to move toward dramatically higher rates of taxation. It may even force Florida and Texas to impose an income tax!
In the Senate version of the bill, states must expand their Medicaid eligibility to cover everyone with an income that is 133% of the poverty level. The House bill brings it up to 150%. But a host of states have kept their state taxes low precisely by so limiting eligibility for Medicaid that it essentially is only for seniors needing long term care and not for poor younger people who require acute care.
For example, Texas covers only those who make 27% of the poverty level or less. Florida covers only 55%. Pennsylvania covers only 36%. Arkansas covers only 17%. North Dakota covers only 62%. Nebraska covers only 58%. Louisiana covers only 26%. Indiana covers only 26%.
The revenue required to bring these states up to the 133% level in the Senate bill or the 150% level in the House would be enormous. Even California only covers up to 106% of the poverty level.
All states except for: Connecticut, Illinois, Maine, Massachusetts, Minnesota, New Jersey, New York, Rhode Island, Tennessee, Vermont, and Wisconsin (plus the District of Colombia) will have to raise their eligibility for Medicaid under the Senate health care bill. And they will have to pay for part of the cost. Under the House bill, with a higher Medicaid eligibility standard, Massachusetts and Vermont would also have to pay more.
The Medicaid expansion provisions of the Senate bill are complex. In the first year of the program (2013) states must enroll anyone who earns less than 133% of the poverty level in their programs. For a family of four the national average poverty level in 2009 is $22,000 a year. So any family that size that makes less than $29,000 would be eligible for Medicaid.
For the first three years of the program (2013-2015) the federal government would pay for all of the costs of the Medicaid expansion. But, starting in the fourth year of operation — 2016 – states would be obliged to pay 10% of the extra cost.
While Obama has often spoken about how he won’t raise taxes on the middle class, his health care legislation will require the governors to do so. Particularly in those states with Democratic governors, it is easy to see how the backlash against these new taxes could fundamentally alter state politics.
The following table is a rough calculation of the cost each state will have to bear once it has to pick up 10 percent of the cost. These calculations are based on guidelines laid down for me by the Republican staff of the Senate Finance Committee. There has been no official data yet generated on how much the Senate or House provisions will cost the taxpayers in each state.
STATE SPENDING INCREASES IN MEDICAID REQUIRED BY SENATE HEALTH BILL
Alabama = 394 million
Alaska = 39 million
Arizona = 217 million
Arkansas = 402 million
California = 1,428 million
Colorado = 163 million
Delaware = 35 million
Florida = 909 million
Georgia = 495 million
Hawaii = 41 million
Idaho = 97 million
Iowa = 77 million
Indiana = 586 million
Kansas = 186 million
Kentucky = 199 million
Louisiana = 432 million
Maryland = 194 million
Michigan = 570 million
Mississippi = 136 million
Missouri = 836 million
Montana = 29 million
Nebraska = 81 million
Nevada = 54 million
New Hampshire = 59 million
New Mexico = 102 million
North Carolina = 599 million
North Dakota = 14 million
Ohio = 399 million
Oklahoma = 190 million
Oregon = 231 million
Pennsylvania = 1,490 million
South Carolina = 122 million
South Dakota = 33 million
Texas = 2,749 million
Utah = 58 million
Virginia = 601 million
Wash State = 311 million
Wyoming = 25 million
West Virginia = 132 million
These estimates were obtained by calculating the increase in Medicaid spending in each state to bring it up to the 133% level specified in the Senate bill. Then I applied the percentage of Medicaid spending in each state on acute care (mainly for the poor) as opposed to long term care (mainly for the elderly). Finally, I took 10% of the increase state share of spending and listed it in the table above.
In the Senate version of the bill, states must expand their Medicaid eligibility to cover everyone with an income that is 133% of the poverty level. The House bill brings it up to 150%. But a host of states have kept their state taxes low precisely by so limiting eligibility for Medicaid that it essentially is only for seniors needing long term care and not for poor younger people who require acute care.
For example, Texas covers only those who make 27% of the poverty level or less. Florida covers only 55%. Pennsylvania covers only 36%. Arkansas covers only 17%. North Dakota covers only 62%. Nebraska covers only 58%. Louisiana covers only 26%. Indiana covers only 26%.
The revenue required to bring these states up to the 133% level in the Senate bill or the 150% level in the House would be enormous. Even California only covers up to 106% of the poverty level.
All states except for: Connecticut, Illinois, Maine, Massachusetts, Minnesota, New Jersey, New York, Rhode Island, Tennessee, Vermont, and Wisconsin (plus the District of Colombia) will have to raise their eligibility for Medicaid under the Senate health care bill. And they will have to pay for part of the cost. Under the House bill, with a higher Medicaid eligibility standard, Massachusetts and Vermont would also have to pay more.
The Medicaid expansion provisions of the Senate bill are complex. In the first year of the program (2013) states must enroll anyone who earns less than 133% of the poverty level in their programs. For a family of four the national average poverty level in 2009 is $22,000 a year. So any family that size that makes less than $29,000 would be eligible for Medicaid.
For the first three years of the program (2013-2015) the federal government would pay for all of the costs of the Medicaid expansion. But, starting in the fourth year of operation — 2016 – states would be obliged to pay 10% of the extra cost.
While Obama has often spoken about how he won’t raise taxes on the middle class, his health care legislation will require the governors to do so. Particularly in those states with Democratic governors, it is easy to see how the backlash against these new taxes could fundamentally alter state politics.
The following table is a rough calculation of the cost each state will have to bear once it has to pick up 10 percent of the cost. These calculations are based on guidelines laid down for me by the Republican staff of the Senate Finance Committee. There has been no official data yet generated on how much the Senate or House provisions will cost the taxpayers in each state.
STATE SPENDING INCREASES IN MEDICAID REQUIRED BY SENATE HEALTH BILL
Alabama = 394 million
Alaska = 39 million
Arizona = 217 million
Arkansas = 402 million
California = 1,428 million
Colorado = 163 million
Delaware = 35 million
Florida = 909 million
Georgia = 495 million
Hawaii = 41 million
Idaho = 97 million
Iowa = 77 million
Indiana = 586 million
Kansas = 186 million
Kentucky = 199 million
Louisiana = 432 million
Maryland = 194 million
Michigan = 570 million
Mississippi = 136 million
Missouri = 836 million
Montana = 29 million
Nebraska = 81 million
Nevada = 54 million
New Hampshire = 59 million
New Mexico = 102 million
North Carolina = 599 million
North Dakota = 14 million
Ohio = 399 million
Oklahoma = 190 million
Oregon = 231 million
Pennsylvania = 1,490 million
South Carolina = 122 million
South Dakota = 33 million
Texas = 2,749 million
Utah = 58 million
Virginia = 601 million
Wash State = 311 million
Wyoming = 25 million
West Virginia = 132 million
These estimates were obtained by calculating the increase in Medicaid spending in each state to bring it up to the 133% level specified in the Senate bill. Then I applied the percentage of Medicaid spending in each state on acute care (mainly for the poor) as opposed to long term care (mainly for the elderly). Finally, I took 10% of the increase state share of spending and listed it in the table above.
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