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Sen. Steve Halloran

Sen. Steve Halloran

District 33

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The dust has settled. Signatures have been gathered, lawsuits have been dismissed, and therefore the Medicaid expansion “question” will be placed on the November ballot. Now the real question, “is Medicaid expansion right for Nebraska”? The simple answer is no, and I would like to take this opportunity to explain why expanding Medicaid will do more harm than good for all Nebraskans.
The Medicaid expansion measure that you will be voting on in November would extend coverage out to those living at 138 percent of the federal poverty level, which amounts to an estimated 90,000 Nebraskans. On the surface, this sounds like a good thing, however the expansion will have an opposite effect on our State’s poorest and most vulnerable citizens, namely the some low-income people, families and children, pregnant women, the elderly, and people with disabilities. Medicaid expansion will add 90,000 patients to an already overburdened Heritage Health system. Heritage Health is our State’s Medicaid program. The results will be our most vulnerable citizens will be “crowded out” for services. Currently, for traditional Medicaid the federal government reimburses physicians for patients at the rate of 53%. The remainder is paid for by the state. Under “expanded” Medicaid, the federal government reimburses physicians for those particular patients at 90%. The number of physicians who take Medicaid patients is rapidly falling. Medicaid patients cost physicians more because the program pays less than traditional health insurance. Having a Medicaid card in your wallet does not mean you’ll be able to actually have access to the healthcare you need. Case in point, my office has been working with an elderly a gentleman from Hastings to find a dentist that will accept Medicaid. The closest dentist accepting NEW Medicaid patients was in Grand Island. The situation will only get worse as we add more people to the Medicaid rolls.

Medicaid expansion always turns out to be more expensive than originally projected. The original cost for Medicaid expansion in Nebraska was projected to be $45 million per year, but that cost is more realistically projected to be $90 million. States that implement Medicaid expansion have found that it has been at least 50% more expensive than originally forecasted. For example, in Iowa the per-member Medicaid costs have nearly tripled.
One way costs have increased is by underestimating the number of new patients that were added to the system. In Nebraska the estimated number of 90,000 new Medicaid eligible patients may itself be low. Making eligibility for expanded Medicaid solely based on an income threshold could incentivize some individuals to quit their job or reduce their hours in order to quality for “free” healthcare. This could come at a time of historically low unemployment in Nebraska. As a state we are already challenged to fill work positons, why would we want to add another incentive not to work?
Additionally the 90% paid by the federal government for expanded Medicaid patients is not set in stone. Our country has a $21 trillion fiscal operating debt. We’re adding about $1 trillion to that every year. This debt, or at least the mounting interest on debt, has to be paid. The federal government, looking for ways to reduce expenditures, could easily decide to cut the rate for which they reimburse Medicaid expansion from 90% to the 53% level they now pay for traditional Medicaid patients. This is a potential nightmare situation for the state of Nebraska. If the expanded Medicaid is passed by the voters, the Legislature will already be challenged to find the funds to pay for our 10% portion by either raising taxes or making cuts to other crucial programs such as other services provided by the Department of Health and Human Services and K-12 funding and higher education. I shudder to think of the millions of extra dollars the state of Nebraska would have to come up with by either increasing taxes or diverting from other programs, if the federal government changes their reimbursement rates on expanded Medicaid.

If expanded Medicaid passes in November by the vote of the people, 1 in 5 Nebraskans will be part of the welfare system. The success of a government welfare program should not be measures measured by the number of people we can add but rather by the number of people who can become independent of welfare programs. As a state, expanded Medicaid is simply impractical, unsustainable and unaffordable.

Sen. Steve Halloran

District 33
Room #8th Floor
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2712
Email: shalloran@leg.ne.gov
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