March 31, 2010

Taxation

Compounding Rhode Island's Pre-Existing Condition: Impact of Health Care Reform on the State Budget

Monique Chartier

So here's the deal. When "reform" kicks in, best estimates are that 50,000 people will be added to Rhode Island's Medicaid rolls. Amy Kempe at the Governor's office advises that, after federal matching funds go away, this will cost Rhode Island taxpayers $100-$150 million. Further, Ms. Kempe goes on to point out that

We also know that Medicaid is the 2nd largest budgetary expense, and the new law does little to control healthcare costs, so the Medicaid inflation rate could continue as it has.

So for planning purposes, we should pencil in the higher figure.

The budget deficit for 2011 is over $400 million. Four hundred million ($400,000,000) dollars in current state spending will have to be eliminated just to get to a break even budget. But, as difficult as that will be, our task will not be done at that point. If health care "reform" is not overturned, in four years, we'll need to find an additional $150 million annually.

Every member of Rhode Island's Congressional delegation voted for the health care reform bill. Voted for this additional substantial budget deficit. Voted to expand the second largest spending item in the state budget. Can we look to them for suggestions as to where to find this additional $150 million?

8:03 AM
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You mean that when the Democrats (after engineering their bill to "on paper" pass OMB muster) were talking about Obamacare accomplishing deficit reduction they were only referring to the federal budget, not government in total?

You mean that the Democrats intentionally misled the public in order to socialize healthcare?

Gee, I'm shocked ... SHOCKED!

Posted by: Ragin' Rhode Islander at March 31, 2010 10:55 AM

Monique is correct that the Federal Health Care reform bill is a transfer of responsibility from the Federal Medicare program to the state shared program Medicaid. This point is rarely mentioned nor expanded upon. Citizens are now just beginning to understand the complexities of healthcare reform. Unfortunately, the RI legislators are all in the tank with Pelosi and Reid.

Now is the time for RI legislators to evaluate what is in the best interest of RI and this country. Ironically, RI is trying to implement the Global Waiver Compact to save money on the Medicaid program. Since ObamaCare will increase the roles in Medicaid RI is going to become the national leader in how to lessen the financial blow.

Our federal political leaders are failing us because they see the only solutions to have an impact can be done on the Federal level and the states be damned. Now taxpayers will be hit from both the federal level and state.


Posted by: FLO at March 31, 2010 9:34 PM