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Medicaid Expansion Is Bad Policy, Period

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(The Jefferson Policy Journal ran a column on June 19, 2014 highlighting the positive aspects of how Indiana has expanded Medicaid, This column offers another perspective.)

It is time to stop, take a breath and ask some basic questions about health care:  Do we want to see greater government control over health care dollars and decisions, or less? Do we favor more federal spending, taxes and debt, or less? Are we in favor of a surrender to, or a decisive victory over, Obamacare?

Look at the big picture. Get out of the weeds. Go back to basic principles.  Expanding government control over health care financing and delivery, the central objective of Obamacare, is incompatible with conservative principles.

Take Medicaid. Under Obamacare, the administration hopes to enroll millions more into this government-run health care program. Yet governors, Democrats and even some Republicans, are embracing the expansion. Recently, in Virginia, Democratic Gov. Terry McAuliffe tried to expand Medicaid but failed because the Virginia legislature successfully blocked it. In Indiana, it is Gov. Mike Pence, a conservative Republican, who seeks to expand Medicaid. Some conservatives are trying to convince themselves Pence’s proposal is a step toward Medicaid reform, but you don’t expand a program to reform it. Here’s the big picture.

First, conservatives believe government’s role in health care should be smaller, not bigger. Expanding Medicaid makes it bigger. In Indiana, the proposal removes its existing enrollment controls that were put in place to keep the program budget neutral. The result of this change means at least 340,000 Hoosiers added to the Medicaid rolls. Today, nearly one in four Americans are on this welfare program. Conservatives should be focused on ways to reduce the need for government, not expand it.

Second, conservatives believe government should control fewer health care dollars, not more. That means fiscal discipline. The Indiana plan would accept new Obamacare funding specially designed to entice expansion. State and federal spending would increase. Medicaid already consumes a growing share of state and federal budgets. A Medicaid expansion, even one like Indiana, fuels more government spending, more taxes, higher federal deficits and higher federal debt piled on our children and grandchildren.

Third, conservatives believe Obamacare should be repealed, not reinforced. But, no matter how one dresses it up, expanding Medicaid reinforces Obamacare. In 2010, the Obama administration and its congressional allies forced through an unpopular and unaffordable law without one Republican vote. The law is now even more unpopular and unaffordable, and state officials who expand Medicaid not only send a mixed message to voters, but, as a practical matter, they make the law’s repeal more complicated and difficult. It’s already hard enough to get health policy right.  There is no point in making it even harder.

The Medicaid expansion dilemma in Indiana is a classic example of good intentions gone awry. What started as an effort to test a consumer-directed model through Medicaid has veered off course, leaving core conservative values behind. But, the good news is, it’s never too late to reverse course and get back on track.

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