Colorado’s interim Commission on Medicaid has begun meeting to address the explosive growth of the state’s health care spending. Related concerns are also on the table, such as the management of the Department of Healthcare Policy and Financing (HCPF) and fraud, waste, and abuse.
Are legislators attacking these problems from the correct angles? Let’s find out.
Faulty premises
The most recent Commission meeting raised questions about the government’s priorities in addressing Medicaid and the state budget.
A recurring theme of discussion —nothing new, yet one that actually exacerbates the very problem the Commission is attempting to address — is the idea that the health care funding deficit could be solved by Colorado improving its ability to draw down federal dollars.
However, as previously explained, the system of drawing down more federal matching money for health care creates a self-perpetuating loop of increasing costs in pursuit of increased federal funding.
If the Commission’s focus is on increasing federal funding, it suggests that the exorbitant cost increases will continue.
Tradeoffs
During witness testimony, it was claimed that Colorado is the number one destination for Americans with disabilities in the country, and that is often because of how quickly they can access state benefits.
While many progressive legislators are sure to feel proud of the ease and speed of providing benefits to new residents, what they may miss is how this drives unsustainable spending and potential abuse.
Legislators must reconcile their desire to offer everything to anyone with the reality of the state’s fiscal situation.
Although inconvenient for lawmakers, economic scarcity is real: they can provide “free” services for a time, just not forever.
Accountability
The hearing ended with a final testimony about HCPF’s utter incompetence and refusal to take accountability for its inefficiencies and problems.
While fresh leadership and rejuvenated legislative oversight of the state’s largest department will hopefully address some shortcomings of HCPF, lawmakers must understand that the department got to this point for a reason.
Bureaucracies act in accordance with the incentives presented to them, so it’s unlikely that the department will improve without real structural changes.
Unfortunately, if either Proposition NN or Initiative 195–or more frighteningly both–pass, it is likely that health care reform will move considerably lower on majority Democrats’ priority list.
If Coloradans want to ensure the state government gets serious about runaway health care overspending, they must reject both Proposition NN and Initiative 195 in November.
Like a drug addict, Colorado would face withdrawals if forced to face fiscal reality, likely in the form of reduced benefits or higher barriers to entry for enrollees.
However, doing so is crucial to ensure sustainable spending for future generations.
