| KPI On SCOTUS Ruling: Federal Power Expands and Medicaid Presents $4.7 Billion Question to State |
June 28, 2012 - Wichita - Americans are only beginning to digest the impact the U.S. Supreme Court's ruling on federal health care reform will have on their lives. Regardless of the practical impact this ruling ultimately has on every-day Kansans, America has a health care problem that needs to be addressed. Kansas Policy Institute argues that the reforms needed should focus on the patient and less government involvement between Kansans and their doctor.
Dave Trabert, president of Kansas Policy Institute, offered this initial response to the ruling, "If the Commerce Clause has limits and says the Feds cannot mandate you do something, it seems to violate the spirit of the Constitution that you can be taxed for not doing it."
Trabert continued, "For 70 years the federal government has layered more and more regulation on your doctor and your health care has suffered as a result. Rarely are Kansans better off when politicians, of either party, decide to interfere with their health care. Unfortunately, this law does exactly that and the Supreme Court made clear that, through the tax code, the Federal government can tell Americans how to live."
The question remains as to how the Medicaid provisions will affect the Kansas budget. From page 55 of Chief Justice Roberts' opinion "Nothing in our opinion precludes Congress from offering funds under the ACA to expand the availability of health care, and requiring that states accepting such funds comply with the conditions on their use. What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding."
A study conducted last year by KPI on the impact the Affordable Care Act (ACA) will have on the state budget demonstrated that upon full implementation Kansas will be required to spend an extra $4.7 billion from the Kansas General Fund budget between 2014 and 2023; much of the ACA only takes effect in 2014. Total General Fund spending on Medicaid over that ten-year period is projected to be $20.8 billion, 29 percent more than would have been spent absent the bill. Jagadeesh Gokhale, Ph.D., a member of the Social Security Advisory Board and former senior economist at the Federal Reserve Bank of Cleveland, wrote in the paper that the expansion of Medicaid included in the ACA is set to balloon Kansas spending and crowd out the resources available for other government functions such as education and transportation.
Trabert concluded, "After the passion of today's unfortunate decision subsides, the Kansas Legislature and Gov. Brownback will have to decide if they want to increase state spending by $4.7 billion and pass those costs along to taxpayers. Currently, Medicaid spending accounts for 18% of state revenues but under the ACA will hit 31% is just ten years. That doesn't allow much room for spending on other state priorities such as education." |
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Kansas Policy Institute is an independent think-tank that advocates for free market solutions and the protection of personal freedom for all Kansans. Our work centers on state and local economic policy with primary emphasis on education, fiscal policy and health care. We empower citizens, legislators and other government officials with objective research and creative ideas to promote a low-tax, pro-growth environment that preserves the ability of governments to provide high quality services. To speak with Kansas Policy Institute, please contact James Franko at (316) 634-0218.
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