Has Obamacare Turned Uncle Sam into a Drug Dealer?
Obamacare is fueling the opioid epidemic. That’s according to an explosive new report from the Senate Homeland Security Committee.
The health law expanded Medicaid coverage to millions of childless, able-bodied adults. Some of them have used their free coverage to obtain prescriptions for powerful opioids, which they have then sold on the black market. In effect, the U.S. government is paying for many of the addictive pills that directly and indirectly kill tens of thousands of Americans each year.
It’s time for Congress to roll back the Medicaid expansion — and fundamentally reform the broken program so that it protects taxpayers and better serves the truly needy.
President Obama’s health law initially required states to expand Medicaid coverage to anyone who earns less than 138 percent of the poverty line. In 2012, the Supreme Court ruled that the expansion was optional. Nevertheless, 31 states and the District of Columbia took the federal government up on its offer. In November 2017, Maine’s voters approved a referendum directing the state to expand Medicaid.
It’s easy to see why. The federal government agreed to pay 100 percent of the expansion’s cost in 2014, 2015, and 2016. In 2017, the feds ponied up 95 percent of the cost. That share gradually drops to 90 percent by 2020.
This cost-sharing arrangement for the expansion population is far more generous than for the traditional Medicaid population. For the latter group, the federal government picks up between 50 percent and 80 percent of the cost. State governments cover the rest.
In other words, thanks to Obamacare, the federal government offers states more money for enrolling able-bodied, childless adults in their Medicaid programs than it does for children and the destitute elderly. That’s perverse.
It’s also deadly. Opioid abuse, overdose deaths, and Medicaid drug fraud cases have all skyrocketed because of the expansion.
The severity of America’s opioid epidemic is difficult to overstate. In 2016, more than 42,000 Americans died from opioid overdoses — a 28 percent increase from the previous year. Thanks largely to all these deaths, Americans’ life expectancy has fallen for two consecutive years — an unheard-of occurrence in the developed world.
The crisis is particularly severe in the Rust Belt. Overdoses in Ohio soared after Obamacare’s Medicaid expansion began in 2014. From 2014 to 2016, the Buckeye State recorded a fivefold increase in deaths from fentanyl, a powerful synthetic opioid.
Obamacare’s proponents say the Medicaid expansion has helped mitigate this public health crisis. As one writer at the far-left website ThinkProgress recently put it, the expansion “has improved efforts to combat the opioid crisis by improving access to treatment.”
They have it exactly backward. About 80 percent of heroin and fentanyl users spiraled into their addictions after first getting hooked on prescription painkillers. The Medicaid expansion made those painkillers widely and cheaply available.
Some people chose to sell their painkillers on the black market. As the Senate committee’s report notes, “Medicaid co-pays can run as low as $1 for as many as 240 pills — pills that can be sold for up to $4,000 on the street.”
This lucrative, albeit illegal, business model explains why there was a 55 percent increase in the number of Medicaid-opioid fraud cases in the four years following expansion compared to the previous four years. More than 80 percent of fraud cases occurred in Medicaid expansion states, including New York, New Jersey, and Michigan.
The Senate report also notes that drug-overdose death rates are rising almost twice as quickly in expansion states as in non-expansion states.
Rolling back the expansion would temper the opioid epidemic. The recent push by some states to seek waivers from the federal government in order to impose work requirements for Medicaid recipients may help as well.
But rolling back the expansion would also restore equity to Medicaid’s funding formula. No longer would states have a stronger financial incentive to enroll childless adults than the indigent elderly, the blind, pregnant women, and children who can’t support themselves — the people for whom Medicaid was originally created.
But merely halting the expansion isn’t enough. Fundamental reforms are needed to slow Medicaid’s unsustainable spending. The program cost $596 billion in 2017. That tab is projected to rise to $958 billion by 2025.
The federal government could rein in this spending by offering states “block grants” — fixed, lump sums of money for their Medicaid programs. Capping federal payments would force states to manage their Medicaid programs more responsibly, since they’d have to pay the full cost of any budget overruns. And it would also eliminate the incentive for states to expand their programs willy-nilly, as they’d no longer attract matching federal funds for every dollar they spent.
Obamacare’s Medicaid expansion has turned Uncle Sam into a pill pusher. That’s obscene. And it’s just one more reason to reform the broken program.