Let's consider that statistic.
Harris states that 50% of California children are on Medicaid which is referred to as "Medi-Cal" in the state.
The obvious question is how has a welfare program for low income individuals, that did not even exist until 1965, came to cover half of the children in a state?
The next question is how could a state like California, which is totally controlled by Democrats, come to a point that half of its children are so poor that they have to rely on the federal government to such a degree?
It is also interesting to note that over half of the total births in California are paid by Medi-Cal. This graph shows the trends in California since 1977 until 2011. This percentage is undoubtedly much higher today due to the expansion of Medicaid which added 3.8 million people to the program in the state since 2014 (by the way, that is 4 times the number that was originally projected when Obamacare was passed). It would not surprise me that almost 3 out of every 5 births in California are being paid by the taxpayers today.
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| Credit:http://www.dhcs.ca.gov/services/medi-cal/Documents/Medi-Cal_Birth_Statistics_Presentation.pdf |
The Medicaid program is jointly funded by the federal government and the states. The states generally set eligibility standards for their state subject to federal limits and the federal government provides matching funds to assist in the costs.
This graph from the Department of Health and Human Services provides some context on the massive growth of this entitlement program since its inception in 1965. From no participants in 1964 to a projected 80 million in 2025.
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| Credit: Department of Health and Human Services 2016 Actuarial Report on Medicaid |
Under Obamacare, the states were given incentives to increase Medicaid eligibility with the federal government promising to pay 100% of the additional costs for 2014-2016. This year that subsidy is reduced under the law to 95% and it will phase down to a 90% subsidy in 2020 and and later.
Predictably, Medicaid expansion has been the most popular feature of Obamacare. After all, "free" always has a lot of takers. However, it has come at a cost. Federal money for the expansion was projected to cost $42 billion in 2015. The actual federal cost was $68 billion---62% higher than estimated.
32 states (including DC) elected to expand Medicaid and 19 states did not. The 19 states that did not do so understood that nothing is ever "free". When the federal government hands out money, strings are always attached. In addition, "free" only lasted for three years with Medicaid expansion. The states that expanded Medicaid now have to pay part of that cost going forward.
For example, in California, the expansion will cost the state an additional $500 million in 201 compared to 2016. By 2020, the additional cost to California is projected to increase to between $1.4 billon-$1.9 billion per year.
For perspective, California is spending over $100 billon for its Medicaid program of which about 63% is paid by the federal government. State spending on Medicaid in California is approaching $40 billion per year. California will collect about $84 billion from personal income taxes this year meaning that almost 50% of its income tax collections are necessary to just fund its Medicaid costs.
68% of births paid by Medicaid in California in 2011 (the most recent data I could find) were born to mothers of Hispanic origin. At least 30% of all births were to undocumented illegal immigrants. 45% of all Medicaid births in the state were to foreign born mothers. All of this data is in this report
All of this spending on Medicaid has had the result of squeezing everything else in the California budget as it has in most every other state budget across the United States.
For example, here is what has happened to state support for the University of California and California State University systems on a per student basis since 1980 as Medicaid costs have taken larger amounts of the state budget.
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| Credit: http://www.ppic.org/main/publication_quick.asp?i=1119 |
I wrote about what Medicaid and health care spending have done to my home state of Ohio in this post back in 2014 just as Governor Kasich was ignoring the will of the Ohio people and the state legislature by expanding Medicaid under Obamacare.
From 1970 to 2014, inflation would have increased the Ohio state budget by 6.1x if all spending matched the rate of inflation over those years.
The Ohio budget had, in fact, actually increased by 22.3x over that time---over three times the increase in inflation.
Education spending had increased by 14.5x. Higher than inflation but much lower than the overall increase in state revenues and state spending.
However, health care spending, driven principally by Medicaid, had increased by 66.7x!
Of course, the policy argument made for increasing Medicaid eligibility was that it would assist in keeping costs down for private sector employer and individual health plans by reducing uncompensated care costs. The logic was that these costs ended up being charged to private sector plans and better managing these costs within the Medicaid system would reduce overall costs (lower emergency room visits etc) while moving these costs to the government would alleviate the private sector from bearing these costs.
However, I have seen no evidence that this had been the result in any data I have looked at.
For example, the average single premium per enrolled employees in private sector employer plans in California increased by 28.2% between 2009 and 2015 (the most recent data available). That is higher than the U.S. average increase of 27.7%. Compare that to the 18.6% increase in private sector costs in Georgia which did not expand Medicaid.
Even when you compare California to two other states with large, immigrant populations---Texas and Florida--who did not expand Medicaid, there is nothing to indicate that Medicaid expansion reduced costs to the private sector. Both those states saw increases of 30%, just slightly higher than California.
In Ohio, the cost increase for private sector employer plans was 39.4%. Compare that to Wisconsin which did not adopt the Obamacare expansion with federal dollars, but did a modified eligibility expansion. Its costs have only risen by 17.1%
All of the private sector premium cost data reference above is from the "Medical Expenditure Panel Survey" which is published annually by the Agency for Healthcare Research and Quality of the U.S Department of Health & Human Services.
It is also interesting to look back at the Congressional Budget Office projections in 2013 right before Obamacare was implemented to put all of this in perspective.
What has Obamacare really done?
It has massively increased the Medicaid rolls and massively increased taxpayer costs at both the federal and state levels while doing little to control private sector health care costs. In fact, Obamacare mandates have massively increased the costs of individual and employer plans. The individual market has been destroyed and it is only affordable to those who receive federal subsidies in the exchanges.
As Obamacare repeal effort are being discussed you are going to hear a lot of statements like those of Senator Harris that are intended to sway public opinion with emotion. Consider the math of Medicaid and see through the myth that the expansion effort has been anything but another redistribution scheme. In the end, Obamacare is more about buying votes than making health care more affordable and available for everyone.
For the Democrats that means taking dependent children and ultimately making them dependent adults who will vote for Democrats in the future. It is on full display in California.
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