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House of Representatives
Session of 2013 - 2014 Regular Session


Posted: January 4, 2013 01:34 PM
From: Representative Stan Saylor
To: All House members
Subject: Obamacare Medicaid Expansion Prohibition
Medicaid is one third of Pennsylvania’s entire state budget and its spending supersedes all other funding priorities like education and transportation. Last session there was plenty of discussion on how the General Assembly allocated state funding for higher education; however, certain fiscal decisions had to be made because of the exponential growth of Medicaid expenditures. These costs are mandatory and are far from being considered discretionary.

While we were making fiscally responsible decisions about our own Medicaid program, you may recall the SCOTUS upheld the constitutionality of the federal Patient Protection and Affordable Care Act, commonly referred to as Obamacare, on the basis of it being a tax as well as determining that states have the latitude to determine whether or not they participate in the new Medicaid expansion without the fear of losing existing Medicaid funding. We were hopeful there would be some level of flexibility to allow Pennsylvania to be innovative in providing health coverage while containing costs.

Unfortunately, last month the United States Health and Human Services Department announced the federal law does not provide states with the ability to determine the level of expansion that best suits their population, nor will the Centers for Medicare and Medicaid Services (CMS) provide waivers to allow states to design their own Medicaid expansion. This is a clear signal that the Obama Administration is not serious about providing states with flexibility to expand their own Medicaid populations as they see fit. Without the ability to provide efficiency and ensure it is sustainable for the long term, the federal government is dictating to states how they must do things and are prohibiting states from taking common-sense steps to contain costs and best provide services to our citizens.

Based on the cost estimates presented by Secretary of Public Welfare Gary Alexander before the United States Committee on Energy and Commerce, Subcommittee on Health on December 13, 2012, if the Federal Government pays 100 percent of the Medicaid expansion, the Commonwealth will still incur costs: $222 million in the first fiscal year, $378 million in the second, and $364 million in the third. When the federal government lowers its rate to 90 percent, our situation worsens to a cost of $883 million by state fiscal year 2020-21. And this cost hinges on the ability of the federal government to fulfill its promise of ongoing funding while addressing annual federal deficits, and our national debt.
As a skeptic of the expansion who previously introduced legislation to prevent the Medicaid expansion in Pennsylvania on the basis of it potentially bankrupting us, I am reintroducing this legislation and reaffirming with the latest evidence that the Medicaid expansion as stipulated under Obamacare is the wrong course of action and a disaster in the making.

For all of these important reasons, I hope you will consider joining me in support of this important legislation.

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Introduced as HB269