SHEPERDSTOWN, W.Va. – In West Virginia, 250,000 workers are waiting on tenterhooks to find out if expanded Medicaid eligibility under provisions of the Affordable Care Act (Obamacare) will be embraced by Gov. Earl Ray Tomblin.
Under Obamacare the federal government pays 100% for expanded state Medicaid coverage for three years, followed by incremental state contributions of up to 10%.
Because the expansion of Medicaid offsets already uncompensated costs of emergency rooms and free clinics, the actual increment for West Virginia, after the three years, would be less than 2.6%, according to an Urban Institute/Kaiser Commission study.
Medicaid in West Virginia currently puts applicants through a bureaucratic battery of red tape and “assets tests,” and ends up excluding up to 30% of the workforce from coverage.
Under expanded eligibility, minimum wage workers, and hundreds of thousands more who still make less than 138% of the “official” U.S. poverty line, will be automatically enrolled – with just one phone call and a simple income tax statement. Further, both benefits and reimbursements to doctors will rise to Medicare levels, since many Medicaid doctors reported that paperwork expenses exceed reimbursement levels. In the past this has made finding Medicaid providers a real obstacle to care for many workers.
West Virginia currently spends $740 million each year in uncompensated care (emergency room and free clinic services). The increase in Medicaid expansion – after three years – will cost the state $330 million. Combined with the federal partnership exchange for above-poverty coverage, and well-administered by the states or regions, Obamacare should greatly reduce the states’ burden for uncompensated care.
But these factors only address the hard-core health care pluses (and do not even deal with the economic pluses of a healthier workforce). The potential boon to small- and medium-sized businesses from virtually universal coverage is immense. First there is the huge shot in the arm to the health care occupations and related economic activity from the large infusion of federal money – over $10 billion for West Virginia. Second, the ability to start a business knowing that no employee will be driven away by medical costs removes a large burden on innovation and entrepreneurship.
So why should noted West Virginia “blue dog” Democrat Gov. Tomblin hesitate over the 2.6% cost increments, given the much greater potential benefit? Because increased costs, no matter how small, can only come from one place in West Virginia: coal, the source of the state’s trillions of dollars in underground mineral wealth.
Coal companies, and perhaps the shale gas industry as well, are not interested in a diversified economy or in growth, except in their sector. Their operations are usually not compatible environmentally or culturally with most other industries or service economies. Thus coal has historically viewed alternative economic development as an endless array of threats and costs imposed on their operations.
Further, the industry is not interested in sharing any greater portion of West Virginia wealth with the state’s citizens. When, after a hundred years or more of tax-free status in the state, a severance tax on coal production was enacted, the industry used it as bait and bribery to enable mineral interests to overwhelm competition. The curse of a resource-based economy, when the resources are extracted by an elite, our own little Libya, comes home again.
Unless the people demand greater control over their common wealth, the risk of blue dog, coal-owned politicians making them even poorer, even as the real wealth rises, will never end.
In a week we will know what Tomblin will do. In the meantime, health care advocates, patients, and anti-poverty organizations are deluging the governor with one message: “Expand Medicaid.”
Photo: Jobs With Justice, Flickr.