Guest Column: Why Brewer's proposal to expand Medicaid spending is smart policy

2013-03-22T00:00:00Z Guest Column: Why Brewer's proposal to expand Medicaid spending is smart policyMike Hammond Special To The Arizona Daily Star Arizona Daily Star

Gov. Jan Brewer has proposed restoring medical coverage to thousands of working poor Arizona adults. Now the Legislature must decide whether to enact the governor's proposal. As legislators deliberate, we urge them to consider that this expansion of Medicaid coverage will have major benefits but will cost the state nothing.

The Southern Arizona Leadership Council, a business organization whose members are leaders of 118 of Southern Arizona's largest companies, strongly supports the Medicaid expansion. Significantly, SALC is only one of many Arizona business groups supporting it.

We urge legislators to focus on the following economic factors:

• The expansion will help the still-recovering economy. The expanded health-care coverage would inject $1.5 billion of additional federal money into the Arizona economy every year. A recent Arizona State University study estimates this additional revenue will add more than 15,000 jobs annually. As Arizona continues to recover from the recession, nothing else our legislators can do - no spending cut or tax decrease - would come close to putting as many Arizonans back to work and having such a strong positive impact on our economy.

• There will be no cost to Arizona taxpayers over the next three years. The federal government will pay more than 90 percent of the additional cost in fiscal year 2015, the first year of full implementation. The state's share of the remaining cost will be provided by Arizona hospitals under an assessment that is used successfully in many other states. This will not be an unwelcome new tax for the hospitals. Indeed, the hospitals proposed it.

• It will lower health insurance costs for all Arizonans. In the United States, uninsured people who are seriously ill generally are not denied health care. They often get it by going to hospital emergency rooms, where the cost of their treatment is much higher. To compensate for the costs of treating those who cannot pay, the hospitals have no choice but to raise their fees to those who can pay. This means higher costs to businesses that provide health care to their employees and to individuals who buy their own insurance. The expansion of Medicaid coverage would dramatically reduce this "hidden tax," which is estimated to be $1,700 per year for the average family.

• It will make Arizona businesses more competitive. By reducing the hidden tax and by creating a healthier workforce, the expanded health-care coverage will increase Arizona companies' ability to compete with companies in nearby states.

• It is what voters want. Twice Arizona voters have overwhelmingly voted to extend medical coverage to working poor adults, once in 1996 and a second time in 2000. However, to offset financial shortfalls in recent years, the state has curtailed the expanded coverage.

• It is the right thing to do. Arizona has a higher percentage of uninsured working poor adults than most other states. By providing them with health-care coverage, this proposal would provide a tremendous boost to the well-being of about 300,000 working poor Arizonans and bring Arizona in line with other states.

• Brewer's plan includes a "circuit-breaker" to protect the state. In the event that the federal government decreases its Medicaid funding for the working poor to less than 80 percent of the cost, then Arizona's expansion of coverage would be automatically repealed.

• Finally, legislators who vote for this sound economic health-care decision will earn the support of the vast majority of their constituents, who rightly view this as a productive, positive and welcome opportunity.

Mike Hammond is the chairman of the Southern Arizona Leadership Council.

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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