The 300 Million Dollar Question: MN vs. WI

Minnesota’s Obamacare emergency turns the tables on Medicaid expansion arguments

October 31, 2016

By Chris Rochester
MacIver Institute Communications Director

Minnesota politicians are in a panic. Just weeks after state regulators announced sky-high premium increases in the wake of the near-collapse of its Obamacare market, Gov. Mark Dayton and the state legislature are rushing a temporary plan to shield Minnesotans from the permanent Obamacare reality.

The whole ordeal is a stark reminder that Gov. Walker and Wisconsin’s fiscally conservative legislature did the right thing in rejecting an Obamacare exchange and Medicaid expansion.

And it makes it a little easier to live with “the first place Minnesota Vikings.”

Dayton rolled out his emergency plan late last week in response to the news that Minnesotans would be nailed with premium spikes between 50 and 67 percent for Obamacare plans starting in 2017. He hopes to ram it through an emergency session of the legislature.

An early cheerleader of Obamacare and a prophet of socialized medicine, Dayton recently admitted that its prices are out of control. “The reality is the Affordable Care Act is no longer affordable for increasing numbers of people,” Dayton told the Associated Press in October.

Dayton estimates that the plan would reduce the average premium increase from 55 percent to 16 percent and cost a whopping $313 million. Minnesota’s taxpayers will pay the entire $313 million to prop up President Obama’s disaster. No federal bailout here. The President conveniently forgot to mention this cost to the states as he did his best impression of a snake oil salesman to sell Obamacare exchanges and “free” federal money.

The average increase in Wisconsin premiums next year is 16 percent – far from a rosy picture, but then again our legislature isn’t scrambling to hold an emergency session.

Defenders of the (Un)Affordable Care Act continue to point to premium subsidies that shield lower-income enrollees from this year’s round of price spikes. Despite the desperate excuse-making from the left, however, the Pioneer Press reported that the subsides are useless to more than 100,000 Minnesotans on Obamacare:

Minnesotans who earn less than 400 percent of the federal poverty line — $47,000 for an individual or $97,200 for a family of four — can get relief from federal tax credits if they buy insurance from the state-run MNsure exchange.

But Minnesotans who earn more than that cutoff aren’t eligible for any aid. An estimated 123,000 Minnesotans could be left to bear the full cost of premiums, such as the $2,378 per month administration officials estimated a family of four in Rochester might pay.

Twenty-three hundred a month for a family of four doesn’t sound like President Obama or Governor Dayton are bending the health care cost curve.

The sky-high premiums don’t tell the whole disaster. The massive deductibles most Obamacare plans now require practically render the coverage useless, especially for low-income people who can’t afford the out-of-pocket costs.

Dayton’s plan would provide a 25 percent rebate on the increased premiums for those 123,000 Minnesotans who don’t receive federal subsidies. The $300 million price tag to temporarily fix the Obamacare exchange will consume Minnesota’s entire budget surplus.

It looks like Obamacare has not only ruined Minnesota’s insurance market, but it’s now ruined their budget and forced the state’s taxpayers to pay twice to paper over Obamacare’s disastrous consequences.

The left in Wisconsin also persistently claims that by rejecting the federal Medicaid expansion, we’re losing more than $300 million per biennial budget.

“By the end of 2021, Wisconsin taxpayers will have lost $1.07 billion dollars in general purpose revenue (GPR) if we continue Governor Walker’s policy of refusing to take the federal funds that belong to Wisconsin,” said Sen. Jon Erpenbach in a statement. It simply is time to put more than $320 million in our coffers without raising taxes and without cuts,” he said.

Whoops. Now that it is going to cost the state of Minnesota $300 million in just this year alone to make the skyrocketing prices of Obamacare somewhat bearable, does Citizen Action and politicians like Erpenbach still believe Wisconsin was wrong to reject the biggest scam ever perpetrated on the American people?

In Minnesota, a $313 million surplus will evaporate as a direct consequence of Obamacare’s failure. That’s $313 million less to spend on tax relief or other state priorities. Here in Wisconsin, our markets are tame by comparison and our budget picture looks good, all despite the fact that Gov. Walker rejected the $320 million in “free” federal Medicaid money.

The $300 million question, then, is whether accepting the “free” money was the right thing to do. Considering the Minnesota debacle and all other mounting evidence, the answer is an unequivocal NO.