Medicaid Expansion Would Save Wyoming Millions

The enormous investment Wyoming made in mental health and substance abuse treatment in the last decade puts the state in a position to cash in big on the implementation of the Affordable Care Act (Obamacare). Governor Mead and state legislators should weigh the opportunity before rushing to join other Republican governors rejecting federal funding of Medicaid expansion.

            

Today Wyoming taxpayers spend more than 95 million dollars each budget period on mental health and substance abuse services. If Wyoming implements the Medicaid expansion under Obamacare, most of that money can be returned to the general fund. Here’s why the new law provides our state with such a windfall.

More than 86 million are state general funds and another nine million are tobacco settlement funds. Almost all are provided to community mental health and substance abuse centers across the state. For the most part the people needing those services are uninsured. Those with insurance, have woefully inadequate coverage for these services. As a result, the taxpayers have been footing the bill.

           

Wyoming has invested heavily in an effort to provide necessary treatment and the funding grew significantly during the last 10 years largely because of the meth crisis. People needed treatment and if they couldn’t afford it, that presented a public safety problem. But insurance didn’t cover the cost. So the state had no choice. Now that Congress enacted Obamacare,  we have a choice.

          

If the state opts for the expansion of Medicaid under the new law, most of Wyoming’s uninsured families will have insurance. Insurance will be required to include treatment for mental health and substance use disorders.

Before the new law, psychiatric or substance abuse disorders were pre-existing conditions for which a person could be denied insurance. No more. Nor can insurance companies impose lifetime limits. Mental illness and addiction are treatable, but rarely curable. That’s why the current limits on treatment are as irrational as they are unfair and counterproductive — but until now the hallmark of commercial medical insurance.

The Affordable Care Act treats psychiatric and addiction illnesses like any other health problem, removing obstacles to treatment. Obamacare combines the requirement that insurance policies cover these services with the individual mandate for health insurance. As a result more people will have insurance and their insurance, not the taxpayers, will pay the cost of mental health and substance disorder treatment.

That’s why the Supreme Court decision upholding the act was good news for Wyoming families whose loved ones suffer from these conditions. But the celebration is premature should Governor Mead or the legislature choose to sacrifice these families to a doctrinaire opposition to the President.

Rejecting the Medicaid expansion under Obamacare would cost Wyoming taxpayers hundreds of millions of dollars first because in the initial three years, the federal government will pay the entire cost of the expansion. After that, the federal match drops gradually to 90% where it will remain. As a result most of the 80,000 Wyoming families currently uninsured will have insurance. If Wyoming opts out, our federal tax load will not decrease. The taxes we pay will go to help citizens of other states while our own people go without. Doesn’t make sense.

Economically it would mean millions of dollars available to Wyoming would not be available to bolster the state’s healthcare structure. These dollars don’t go into the pockets of people needing healthcare. They go to community healthcare providers who are able to expand the state’s healthcare system. These dollars go to work throughout the community. Can you imagine Wyoming turning down any other economic development opportunity of that scale? 

As though that were not incentive enough, if the state moves ahead with the Medicaid expansion, it can reduce the budget of the Department of Health by as much as 90 million dollars by 2014. Giving this much money to community mental health centers will largely be unnecessary, replaced by insurance coverage under Obamacare. Ninety million dollars in savings should be enticing as the state searches for ways to reduce spending.