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A Billion Dollars and Counting; What Kansas Lost by Not Expanding Medicaid

When converted into $100 bills, here's what one billion dollars looks like on wooden pallets. (Photo from Wikipedia)
When converted into $100 bills, here's what one billion dollars looks like on wooden pallets. (Photo from Wikipedia)

The state of Kansas has forfeited more than a billion dollars in federal funding by refusing to expand Medicaid coverage. Most states have already increased eligibility for the federal program, which provides health insurance for the poor. Guest Commentator Duane Goossen says further inaction by the legislature and the governor will continue to cost Kansas money while more than 100,000 residents go without health insurance.

Guest Commentator Duane Goossen is a Senior Fellow at the Kansas Center for Economic Growth. He's also a former state budget director and former Kansas lawmaker.

Production assistance for the commentary was provided by KPR News Intern Austin Fitts, a graduate of the University of Kansas. 


(The audio above is a radio version of the transcript below. Here is the full text of the commentary as it appeared in print. The radio version was edited for broadcast.) 

A Billion Lost and Counting

One billion dollars forfeited, with more money lost each day, each hour. Inaction makes the problem worse with every passing minute. Surely such a situation should spur Kansas lawmakers to action. For two years running, Kansas has turned down the opportunity to expand Medicaid eligibility, and to have the federal government pay the full cost. This winter the tab for saying “no” topped $1 billion and continues to mount.

Did the refusal to accept these federal dollars bring some other benefit to Kansas? Will anyone pay lower taxes as a result?

No. The money is simply relinquished, gone from the state economy, a tragic, mind-blowing loss to Kansas.

One hundred fifty thousand more Kansans could have had health coverage for the last two years. Most of these individuals work, but their earnings are too low for them to afford health insurance, and they are not eligible for an insurance subsidy.

Some still received health services by showing up at hospital emergency rooms, but those hospitals took a loss by providing uncompensated care. Especially for rural hospitals, such losses make financial survival much more difficult.

Most states have already expanded Medicaid eligibility. Kansas remains one of 19, predominantly southern states, that have held ideologically firm against Obamacare. That’s the reason—a blind objection to anything that might be connected to Obamacare. Policy challenges over cost or implementation strategy have all been answered. Do you want Medicaid to look more like a private insurance plan? Then set it up that way. Arkansas did. Should recipients pay something? Fine. Indiana requires that. What about incentivizing healthy behavior? Okay. Iowa took that approach. Should expansion be budget neutral, now and in the future? Sounds great. A bill proposed in Kansas does exactly that.

Kansas lawmakers could solve this in a hurry if they did their policymaking job and figured out how to make expansion work on Kansas terms. Call it KanCare expansion, if that helps, but go forward.

When Republican Asa Hutchinson became the new governor of Arkansas in 2015, he sought to continue the state’s expansion that had been previously put in place. Explaining why, he argued that turning away federal dollars that more than 30 other states were receiving would punish Arkansas. "It is perfectly consistent, it is perfectly conservative and logical to oppose Obamacare as a federal policy and yet accept federal dollars under the Medicaid program in Arkansas."

Exactly. Hurting ourselves to protest Obamacare conjures up the old adage of cutting off the nose to spite the face.

Most Kansas citizens have arrived at that same conclusion. Whatever Kansans may think of Obamacare, independent surveys by the Docking Institute and the Kansas Hospital Association both show wide approval of expanding Medicaid eligibility.

When Gov. Brownback dismissed expansion in his State of the State address, when House Speaker Merrick removed potential yes-votes from the health committee, when Americans for Prosperity began targeting pro-expansion legislators with negative mailers, they clung to an anti-Obamacare ideology at the expense of the economic and physical health of citizens. By refusing these federal dollars, Kansas engages in needless self-destructive behavior.

More than $1 billion has already been lost to the Kansas economy. These funds cannot be recovered, but losses can be cut going forward. A bill is ready that legislators can still pass this session. If lawmakers wait, they’ll be shortchanging Kansas hundreds of millions more.