As more details emerge from Utah's "Gang of Six’" Medicaid expansion framework, it is clear that physicians will be expected to foot much of the bill. In the words of Gov. Gary Herbert, “the theory is the ones who benefit from [Medicaid expansion] should be the ones who pay for it.” This theory is worth further examination.
Who will benefit from Medicaid expansion? The real beneficiaries of Medicaid expansion will be the tens of thousands of Utahans who will receive “free” (taxpayer-funded) government-sponsored health care. It seems that we have lost sight of this. While some health care providers will benefit from Medicaid expansion (particularly hospitals who currently provide tens of millions of dollars in uncompensated care annually to those who would, under Medicaid expansion, qualify for coverage), most physicians would NOT. The vast majority of uncompensated care occurs in Utah’s hospitals, not within physician practices. The only way most physicians would make more money under Medicaid expansion is to see more patients. But Utah’s physicians are already incredibly busy. It can take weeks to get a doctor’s appointment, and many physicians have full practices and cannot accept new patients. The vast majority of physicians will not benefit financially from Medicaid expansion, and under the Gang of Six theory should not be required to pay for it.
Won’t higher reimbursement rates for the Medicaid expansion population benefit physicians? No, unless they swap out their existing Medicaid patients with expansion patients. There are nearly 280,000 Utahans on the existing legacy Medicaid program, and physician reimbursement for this core Medicaid population is as low as 30 percent below Medicare rates and 70 percent below commercial rates. Medicaid expansion will not increase the reimbursement rates for the existing Medicaid program. I suppose physicians could benefit by prioritizing appointments for the expansion population at the expense of appointments for the core Medicaid population, and thereby make more money. But I don’t know a single physician who would make this Machiavellian choice, unless, of course, they feel like they have to in order to make more money to cover the new taxes they will be required to pay under the Gang of Six proposal. If physicians were to make this choice it would only harm access for those Utahans covered by the core Medicaid program.
How would the taxation theory of “the ones who benefit should be the ones who pay” apply to other areas of government funding? Should teachers be expected to pay for the costs of new school construction or higher enrollment in public schools under the theory that they will benefit from the new appropriations for public education? Should road construction engineers and workers be expected to pay for the costs of road construction under the theory that they will make more money with each new project? Should Realtors be expected to pay for the unfunded liabilities generated by Fannie Mae and Freddie Mac under the theory that they benefited from the easy lending policies that drove hot real estate markets? The clear answer to all of the above scenarios is an unequivocal NO. Why should it be any different for health care providers?
We should not tax physicians to pay for Medicaid expansion. If the governor and the Legislature truly believe that expanding Medicaid is in the best interest of all Utahans then they should pay for it with a broad-based tax, as they do with the core Medicaid program, public education, transportation infrastructure and nearly every other major program. They should not expect physicians to involuntarily pay for it, especially under the erroneous assumption that, somehow, they will be enriched by Medicaid expansion.
Dan Liljenquist is a former state senator and former U.S. Senate candidate.