ObamaCare’s Medicaid Provisions Killing State Budgets | Citizens Against Government Waste

ObamaCare’s Medicaid Provisions Killing State Budgets

For Immediate Release

Contact:  Leslie K. Paige    202.467.5334
March 1, 2011 Luke Gelber, (202) 467-5318


(Washington, D.C.) – Today, the Senate Finance Committee and the House Energy and Commerce Committee jointly released a report detailing the brutal realities of the Medicaid program’s cost to state budgets and how the Patient Protection and Affordable Care Act (ObamaCare) will intensify an already fiscally untenable situation.  Medicaid is a primary driver of both state and federal budget explosions. 

According to the joint report, the Congressional Budget Office (CBO) estimated that new state spending on Medicaid will be “$20 billion between 2017 and 2019, and an independent report from the Kaiser Commission on Medicaid and the Uninsured found that new state spending would be even higher at $43.2 billion through 2019.”  The report estimates that, conservatively, the Medicaid expansion provision contained in ObamaCare will cost state taxpayers “at least $118.04 billion through 2023.”

“Yesterday, President Obama threw the governors a bone by encouraging them to embark on their own solutions to healthcare costs; if those alternative plans qualify under the new federal healthcare rubric, he promised to accelerate the waiver program so they could begin implementation in 2014 rather than 2017… as long as they do it his way.  However, ObamaCare is simultaneously delivering a crushing blow to state budgets with massive expansions to the Medicaid entitlement program,” said CAGW President Tom Schatz.  “The President’s policies are reminiscent of the imaginary creature in Doctor Doolittle, the Push-Me Pull-You; between the stimulus spending and the new PPACA rule, state budgets are being torn apart.”    

While the administration is offering accelerated ObamaCare waivers, it has turned a deaf ear to the pleas of dozens of governors petitioning for relief from the rigid rules governing how they run the Medicaid program.  The governor are caught in a fiscal buzzsaw; in order to be eligible for the $87 billion in stimulus money they used to offset exploding Medicaid costs, they were forced to maintain high enrolment levels and prohibited from tweaking eligibility rules.  And, now, just as the stimulus money is about to disappear, leaving the states with boated Medicaid enrolment, ObamaCare tells them that, in order to receive any federal healthcare money, they must preserve their existing dysfunctional Medicaid programs.   

“The Obama administration’s policies have placed atrocious additional fiscal burdens on state budgets while hamstringing governors, who don’t have the luxury of borrowing trillions of dollars from the Chinese to pay for their programs,” concluded Schatz.  “The states are going under, and not only is the President not throwing them a lifeline, he’s pushing their heads underwater.” 

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, mismanagement and abuse in government.

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