AFP-Nebraska Testimony Opposing Medicaid Expansion

February 28, 2013

Opponent Testimony for LB 577                                                                                    February 28, 2013

Chairperson Campbell and members of the Health and Human Services Committee, my name is B-R-A-D S-T-E-V-E-N-S and I am the Nebraska director of Americans for Prosperity, a free market advocacy group with over 40,000 members statewide.

We are opposed to LB 577 for the simple reason that we cannot afford it.

Medicaid expansion would cost the federal government $930 billion from 2014 to 2022.  It is unknown how the federal government can fund nearly $1 trillion in additional spending without gradually shifting those costs onto the states.

The cost of Medicaid expansion in Nebraska would be devastating to our state budget.  Gov. Heineman estimates that Medicaid expansion would cost Nebraska as much as $766 million over 10 years.  And if the federal government does reduce the federal Medicaid match that number could go up dramatically.

Unless we put our fiscal house in order, the federal government will run out of money to spend and Nebraska’s taxpayers will be left footing the bill.

One of the key components of the law is the vast expansion of the Medicaid system, which cannot be done unless states voluntarily participate.  Nebraska legislators should ignore the President’s call.

The Supreme Court said this gigantic expansion could not be forced by the federal government, putting states in the driver’s seat to stop a gigantic new federal spending program.

The federal government is out in force pleading with states to cooperate by offering to fund 100% of the costs for Medicaid expansion for the first three years.  After that the states will be asked to take on a percentage of the cost.

Unfortunately, we have heard from people today who buy into this concept that federal money is ‘free money’.

Federal money is not ‘free money.’  It’s taxpayer money.  It’s our money.

The federal government is over $16 trillion in debt and neither the President nor Congress has shown much willingness to lead to solve this enormous problem.  Relying on the federal government to fund expanded entitlement spending would put our state budget in a precarious situation.

While promises of federal funds for Medicaid expansion are made today, that is no guarantee of funding in the future.

In 2011 President Obama proposed $72 billion in Medicaid cuts and reducing the federal support of state Medicaid costs by $15 billion.  In 2012 the President again proposed cutting $70 billion from Medicaid by revising the federal match to state Medicaid programs.  And the White House 2013 budget proposes to cut $351 billion from entitlement programs over 10 years.

When the federal government is forced to confront its spending problem; whether during the debt limit crisis of 2011, the fiscal cliff crisis of 2012 or the sequestration crisis of 2013 entitlement programs, and the Medicaid program specifically, are routinely scrutinized for cost savings.

Current entitlement spending is unsustainable and expanding the Medicaid program as allowed by President Obama’s health care law and proposed by LB 577 would only put the program at greater risk.

Increased entitlement spending is neither practical nor ethical.  Expanding entitlement programs by $1 trillion will bankrupt our social safety net and prohibit government from providing support for those who truly need it.

While providing access to affordable health coverage for all Americans is a laudable goal, simply expanding government programs and adding to our already unmanageable federal debt is not the right approach.

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