Captain Rick: Dr. Thomas C. Patterson, an Arizona critic of Obamacare Medicaid expansion, explains why this expansion is bad and encourages all to “look behind the curtain.” These are important words as the Arizona Legislature votes on this monument expansion of welfare spending. Arizona is one of about 30 states that have not yet hitched their ‘train car’ to the ‘Obamacare Medicaid Expansion Train’ that is headed down a track that ends a few miles ahead at the edge of the real ‘Fiscal Cliff.’

Dr. Thomas C. Patterson is a graduate of Yale University and the University of Nebraska. He was elected to the Arizona State Senate in 1989, serving as minority leader from 1991 to 1992 and majority leader from 1993 to 1996. Patterson was the author of legislation creating Arizona’s charter school system and welfare reform program. Until 1998, he was a practicing physician and president of Emergency Physicians, Inc.. Patterson also served as president of the Arizona chapter of the American College of Emergency Physicians. In 2000 he became chairman of the Goldwater Institute. Tom is a retired physician and resident of Paradise Valley, Arizona.

I asked Tom why he was contributing his words to Atridim News Journal. Tom replied “I write it because I don’t want to be part of the generation that let liberty die out on our watch or at least I want to know that I did what I could to prevent it. I would like some of the good things about America to be there for my grand-children.”

image Tom Patterson

The pressure from the Obama administration for Arizona to expand our Medicaid program is enormous. Gov. Brewer is on board and even some legislative conservatives seem to be wavering. But legislators should take one more look before they make what could be a fateful leap.

Here’s how it works. If we raise the eligibility requirements for Medicaid to 133 percent of Federal Poverty Level, the feds will drop additional subsidies of $1.3 billion annually into our state over the next three years.

Moreover, this raise can be accomplished with no general fund dollars. The state’s hospitals have agreed to pay additional taxes of $369 million to fund our share of the match. Gov. Brewer points out this is a phenomenal 10:1 “return on investment.”

When politicians use words like “investment” and “return”, your humbug detectors should start going off. If something seems too good to be true, it probably is.

First, the Obama administration pretty much struck out in their attempts to persuade states to establish insurance exchanges, so they’re frantic now to avoid a complete breakdown in the implementation of Obamacare. They’re pouring on the big bucks. But they’re spending borrowed dollars and that can’t last long.

For Arizona, taking on a financially unstable partner in a massive long-term venture wouldn’t be very smart. In fact, the feds are already considering extensive Medicaid cutbacks in their budget negotiations. The bigger point is that sharp reductions in the federal subsidy are a matter of when, not if. By 2020, even the promised subsidy ends. When that happens, Arizona will be left holding the bag.

That bag will be enormous. Of course, the rolls will be swollen by then with the eligibility expansion. But we will also be on the hook for the “woodwork effect”, the high number of patients who have been eligible for Medicaid but never signed up.

A 2010 Harvard study found that barely half of eligible Arizonans were signed up in AHCCCS (Arizona Health Care Cost Containment System), our Medicaid program. These are mostly younger, healthy people who don’t consume much medical care and don’t really need the insurance. If something happens, they can sign up any time.

But with the mandate under Obamacare to provide proof of coverage, the popularity of free insurance will skyrocket. In addition, employers with large numbers of low income workers may drop coverage or shift more workers to part time, making them Medicaid eligible under the new standards. Finally, people on SSI disability, a booming program, are automatically Medicaid eligible.

Medicaid costs have been ballooning 8 percent annually, compared to 1 to 2 percent economic growth. But apparently that’s not enough for the spenders. Total Medicaid spending under Obamacare is projected to grow from $400 billion to $900 billion by 2020. State budgets already stressed by high Medicaid spending will be in big trouble when they’re forced to pick up the tab.

The hospital tax is also deeply problematic. Hospitals are more than willing to go along, because it’s obviously in their best interests. But at heart, it is just a way to force paying patients to fund a welfare expansion that we can’t afford.

But there’s a bigger problem. The tax is unconstitutional unless approved by a two-thirds majority of the legislature. Proposition 108, a voter-passed amendment from 1992, states clearly that any net revenue increase to the state, including fees and special taxes, falls under its provisions.

The Brewer administration, recognizing it is unlikely that two-thirds of each house will sign off on their scheme, has tried to argue that the hospital tax is just a bureaucratically set fee and thus exempt. Whoops, there go the humbug sensors again. They’re not only almost certainly wrong, they’re playing with fire.

If they impose the bed text without legislative super-majority approval and it is later struck down, they would be in a world of hurt. They would lose their revenue and possibly their match and face gigantic Medicaid costs. Plus, there’s little meaning in prop 108’s super majority requirement if it doesn’t apply to this “fee”.

The more you look at this plan, the more serious problems keep bubbling up. Short-term, it has to be tempting to take the money. Ten years from now, the decision is going look a lot different.

Arizona legislators are under intense pressure to pass the Obamacare Medicaid expansion. They’re getting it from all sides.

“Do the math” the governor condescendingly demands, as if it takes special genius to figure out there is short-term gain in accepting these federal funds. “It’s your Christian duty” helpful ministers explain, apparently forgetting that Jesus preached personal compassion for the poor, not government lobbying.

Even the business community is on their case, claiming more Medicaid business will create jobs and stimulate the economy. Of course, if government spending really created net jobs, we would be awash in jobs because we have definitely tried massive spending in recent years.

The opponents of Medicaid expansion are commonly depicted as crazed ideologues blinkered by their opposition to Obamacare. After all, the creators of Obamacare were so frantic to get the states on board with the Medicaid piece that they agreed to provide near total funding initially for this nominally state-operated program. Even by 2012, they promise to provide 90 percent of the funds. Such a deal.

But Arizonans might be wise to look behind the curtain. As time rolls on, Obamacare is already defaulting on most of its key provisions.

For example, we were told that the average family would save $2500 annually on insurance premiums. It turns out the cost of health insurance will increase from $2100-$5000 yearly when Obamacare is fully implemented.

Obama himself promised that under his plan, “if you like your doctor, nothing will change”. Yet a recent poll from the consulting firm McKinsey estimated that over 40 million people will lose their employer-provided insurance. So much for that whopper.

The president also told us that no American families with incomes under $250,000 would see a tax hike. But there are over 20 new taxes in Obamacare. Many of them, like the tax on medical devices, a new tax on drugs, another tax on certain high-end health plans and reduced deductibility for medical expenses all fall squarely on the middle class.

There’s much more. We were told that Obamacare would cost “only” a trillion dollars over 10 years, that the costs would be partially offset by massive reductions in Medicare spending on the elderly, and that we would achieve virtually complete universal coverage. It’s all false, false, false. With a track record like that who could believe their next promise?

Gov. Brewer’s response is to create a “circuit-breaker”, a provision that calls for Arizona to revoke the benefits expansion if the federal funding falls below 80 percent. That sounds good and she is undoubtedly sincere. But she likely won’t be the governor when that day comes and whoever is will be under intense pressure to somehow maintain the program.

That’s the way the welfare state works, the “ratchet effect”. Whatever government provides, it’s never enough and the demands for more stuff never ceases. When benefits are granted, it’s nearly impossible to retract them.

So right here, in Arizona’s intense Medicaid debate, we see how Big Government rolls over and co-opts good people. It pulls the bait-and-switch, puts them in an untenable political position and forces them to support even this unpopular program that is certain to fail.

There is a growing recognition that Obamacare is an ugly hybrid, combining the worst aspects of government medicine and highly regulated private sector medical care. It was never intended by its advocates to be a permanent solution to America’s problems with affordability and access to care. Pres. Obama and others have candidly stated the real goal is a completely government controlled medical system.

That’s why it’s critical to stop Obamacare now and replace it rather than let it fail amid calls for a government takeover. We are going to end up either with medical care dictated by federal bureaucrats or one in which the power of free markets and patient choice prevail.

Real tort reform, price transparency, ability to buy insurance across state lines and many other possible reforms are out there, but we will never get them if the Obamacare train isn’t stopped.

Obamacare must have buy-in from the states to proceed. The stakes for the Legislature are enormous.

Captain Rick: After Tom’s commentary was posted, I asked Tom if my report served his words well. He replied “Everything is fine. Thanks for all your effort to alert Americans about erosions of our freedom. I am happy to be part of it”. Those words gave me great honor.

I welcome your comments, likes, shares and following of my blog! (If not visible, click the red title above)

Associated ATRIDIM NEWS JOURNAL Report Categories:

Medicaid: http://atridim.wordpress.com/category/medicaid/

Entitlement Reform: http://atridim.wordpress.com/category/entitlement-reform/

U.S. Debt Crisis: http://atridim.wordpress.com/category/u-s-debt-crisis/

Fiscal Cliff Course 101: http://atridim.wordpress.com/category/fiscal-cliff-course-101/

Arizona Law: http://atridim.wordpress.com/category/arizona-law/

Arizona: http://atridim.wordpress.com/category/arizona/

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Comments
  1. Sandi Bartlett says:

    Mr. Patterson is exactly correct. His points are clear and concise. This is exactly what the opposition has been trying to tell the Governor and the Republican legislators who are in favor of this expansion which will be a disaster for Arizona. But Governor Brewer will be long gone when this collapses. I recently found this article that makes me wonder when investigations into hospital charges is going to be done. I was astounded at the difference in charges. Why should we trust hospitals. http://www.bloomberg.com/news/2013-05-08/hospital-charges-vary-across-u-s-for-same-procedures.html

  2. atridim says:

    I asked Tom if my report served his words well. I received his reply in an email today:
    “Captain Rick, every thing is fine. Thanks for all your effort to alert Americans about erosions of our freedom. I am happy to be part of it. Tom”.

  3. Thanks Rick for this valuable article and interview with Dr. Patterson. One issue that keeps coming up from the “pro expansion” side is what do we do about the handful of people with ongoing serious health problems, who will lose coverage if the expansion isn’t passed. Unfortunately, the burdens placed on this socialized system of health care will mean longer wait times, delays in treatment, and poor and inadequate care, not to mention the chronic problem of fraud within any “government run” system. The very people who need it the most will be hurt the most. And the economy will hemorrhage with them.

    That brings me to a question about certain programs available through Arizona’s Medicaid program, which is actually called AHCCCS (Arizona Health Care Cost Containment System). That term “cost containment” should be a clue about what’s in store for this “system.” There is a program within AHCCCS titled “Freedom to Work.” I have heard that this is more appropriately titled “Freedom to Find a Way to Use the Program.” There is also a program called ALTCS (Arizona Long Term Care Services). Under this vast umbrella is eligibility to those with autism, epilepsy, developmental disabilities, etc. It might be interesting to find out how the household income is calculated, and if these participants are also eligible for employer-paid health insurance.

  4. Karen Winfield says:

    Terrific explanation, Senator Patterson! Thanks so much!
    Karen Winfield

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