Special Edition on Medicaid Expansion: March 22, 2013

Message from Deputy Vice Chancellor Pinson: Despite the controversy around the ACA, Medicaid expansion is our best choice now

by C. Wright Pinson, MBA, M.D., Deputy Vice Chancellor for Health Affairs and CEO of the Vanderbilt Health System

(A reposting of Dr. Pinson's opinion piece from earlier this week in The Tennessean)

It is essential for Tennesseans to understand the new reality with implementation of the Affordable Care Act (ACA). Whether you are politically opposed to this legislation, or in favor, after last summer’s Supreme Court ruling, now it is time to make a decision about Medicaid expansion that will serve our state’s best interest. (Medicaid expansion should not be confused as a referendum on the ACA itself.) We need to clearly understand what’s at stake.

First, since job creation is on everyone’s mind, let’s talk economics. Tennessee health care professionals provide $4.1 billion in uncompensated care per year that has historically been partially paid for through certain federal and state programs. However, due to recent legislation changes and Medicare reductions, these offsets have been cut. The Tennessee Hospital Association (THA) estimates cuts to Tennessee hospitals of $2.9 billion over five years and $7.4 billion by 10 years, and 10,000 job losses or more if one considers economic multipliers.

There are hospitals in Tennessee, institutions vital to their communities both as health care providers and also as major employers, who will lose services or may perish. If communities lose health care jobs and hospitals close their doors, they won’t be coming back.

However, if Medicaid is allowed to expand this will mean $6.5 billion in new federal funds coming in to Tennessee over 5 five years resulting in 18,000 new jobs, or perhaps more using an economic multiplier calculation. This will substantially replace the cuts described, saving jobs and hospitals, especially in rural areas. It is clear Tennessee loses economically by not expanding Medicaid.

While we should be concerned about our national debt, the Tennessee Medicaid expansion, each year, would represent only 0.007 percent of this debt. The magnitude of the impact on the health and economy of our state far outweighs the magnitude of the impact on the federal debt.

Second, Tennesseans are already paying federal taxes that will be used to fund Medicaid expansion in all states choosing expansion. Why would we want our tax dollars only supporting a growing list (half so far) of other states opting for expansion? We must act to keep our tax dollars in Tennessee, serving our citizens. A recent poll indicates 60 percent of Tennesseans are in favor of Medicaid expansion. Many Chambers of Commerce across the state have endorsed expansion as well.

Third, beyond economics, what about the tens of thousands of Tennesseans who presently can’t afford health insurance? By affording these citizens the opportunity for health insurance, it gives them a chance to actually be managed by a primary care clinician, including preventative preventive care and management of chronic problems (diabetes, heart disease and hypertension) instead of only dealing in crises then receiving care in a very expensive setting, the emergency department.

Recent research found the health of the uninsured has significantly improved in states that early-adopted Medicaid expansion, demonstrated by a 6.1 percent decrease in mortality and a 21 percent reduction in delayed care. The opportunity to shift utilization of health care services away from emergency departments while increasing access to preventative preventive services saves lives and saves money. Shouldn’t we want this for all Tennesseans?

Weighing all the pros and cons, expansion represents the best judgment. It is an investment in the critical safety net services for all of Tennessee.