We wrote last year about the myth that the Arkansas “private option” Medicaid expansion is a job creator for the Natural State.
Friend of the blog and Arkansas Hospital Association lobbyist Jodiane Tritt, passing out talking points to “private option” Medicaid expansion supporters, said at the beginning of the fiscal session in January 2014:
The Private Option can create much-needed jobs across Arkansas. Studies have found that the Private Option will result in an increase of approximately 8,600 new jobs in 2014 and 10,600 new jobs by 2020. These jobs will not only be in hospitals, clinics, nursing and other health facilities, but also in those industries that support the Arkansas health care industry. Our communities will benefit from increases in wages and earnings.
Roger Thomas, CEO of Econometric Studios, crunched the numbers on Medicaid expansion nationwide recently — but he came to a very different conclusion:
If you follow healthcare economics, one of the major discussion points right now is Medicaid expansion, specifically whether a state should expand Medicaid.
Leading up to the decision on whether or not to expand Medicaid, all states’ leaders requested economic impact assessments. In everything reviewed, it appears as though most every group came to the same conclusion – having the federal government pay doctors and hospitals for care would boost economic growth and employment.
This idea has, so far, led 32 states to expand their Medicaid coverage.
When taking the plunge into further government healthcare coverage, all of these states’ leaders were told how beneficial Medicaid expansion would be. Groups such as Public Consulting Group and the White Council of Economic Advisors peddled economic models purporting to show the massive number of jobs that would be created.
In looking at states that have expanded Medicaid versus states that have not expanded Medicaid, a surprising result is materializing.
Instead of expanding states experiencing higher healthcare and total employment growth, the opposite is true. States that have expanded Medicaid are experiencing slower employment growth. It’s also quite difficult to tell if states that expanded Medicaid are even seeing higher employment growth in the healthcare sector – the sector most likely to see expanded revenue and profit from Medicaid expansion.
Perhaps common sense was right on this one – giving doctors and hospitals a bunch of money for stuff they were already doing doesn’t really mean they’re going to hire a whole lot of new nurses, doctors, and other healthcare workers. Instead, the money is mostly used as an easy expansion in profit margins. At least that’s what it looks like right now.
So, just to be clear: states like Arkansas that have expanded Medicaid haven’t seen the large economic growth many Obamacare advocates expected.
Moreover, states that expanded Medicaid are “experiencing slower employment growth.” It’s not even clear if job growth in the healthcare sector of states that expanded Medicaid is better than states that refused to expand Medicaid.
Basically, state and federal taxpayers will be left with the bar tab to pay for Obamacare Medicaid expansion — while big hospital executives and healthcare stock investors get drunk on the profits.
Why, it’s almost as if those grouchy old fiscal conservatives who insisted that we can’t use taxpayer money to spend ourselves into prosperity may have known what they were talking about!
You can read Thomas’s entire report here.