You might think that red states would take billions of free dollars to subsidize their health care. But you would be wrong. As of now, 15 red states have turned down the federal megabucks flat. (*See list of those states at end of this article.)
When Oklahoma Gov. Mary Falin (R) took her $54.6 million, ultra-conservative leaders jumped on her neck, and in the end she returned the money. Red states would rather pay for Obamacare and get nothing for it than give up their stance.
Obamacare Is Better For Red States
Obamacare took money from blue states and gave it to the red states. Who knew? Here’s how it happened.
- There are more uninsured people in red states than in blue states, so red states get more federal money. But 72% of them voted for Mitt Romney in 2012.
- Obamacare taxes the wealthier people 3.8 percent on their investment income. Since blue states have more richer people in them than red states, the blue guys are hit harder with this tax. Ironically 19 out of 25 of the richest states voted for Obama in 2012.
- Obamacare also taxes what they call??”Cadillac” health-care plans starting in 2018. These plans are really good employer-provided benefits. With more unions in the north (blue) states, people will pay more taxes for their Cadillac plans.
“Those in the red states still smarting over Barack Obama’s election victory can perhaps take solace in this. The Democrats’ No. 1 domestic policy initiative, universal health care, is likely to help red America at the expense of blue.”
What Obamacare Gives States
- The federal government picks up 100 percent of states? Medicaid for the first three years and 95 percent in 2017 and 90 percent after that.
- Without Obamacare, the federal government usually pays 57 percent for Medicaid. The state has to pay the remainder. Medicaid is a top budget cost for states.
“If the 23 states that have rejected expanding Medicaid?continue to do so for the next eight years, they’ll pay $152 billion to extend the program in other states ? while receiving nothing in return.”
That’s a helluva gift from (mostly) red states to (mostly) blue ones.
Republicans Turn Obamacare Into Blue State Subsidy
- States could opt out of the federal funds (Supreme Court Ruling in 2010). And many red states did.
- Red states are paying taxes and paying for the spending cuts Obamacare uses to fund the Medicaid expansion. But they get no benefits.
- The government couldn’t use preexisting Medicaid dollars as leverage to force states into accepting Obamacare’s Medicaid expansion (Supreme Court Ruling 2012.)
- More people in red states receive tax credits, because they have lower incomes. This year the Supreme Court could take away those federal subsidies from people living in states with Obamacare.
- Of course the Supreme Court could go the other way.
“Obamacare will become a pure subsidy from the states that hate the law most to the states that have embraced it.”
All states need to do to get all that money is say ‘yes’ to some form of the Medicaid expansion and build their own exchange.
But Obamacare is a powerful football. And some Republican governors? and legislatures? hatred may be stronger than their common sense.
I live in one of those states, Brownbackistan, or as you might know it, Kansas.
Today 150 teachers in my school district retired at 60% pay for five years. Why? We have a budget shortfall and sure could have used those millions our governor turned down.
*Note: Fifteen states haven’t accepted the Medicaid expansion and haven’t built their own exchange: Alabama, Florida, Georgia, Kansas, Louisiana, Maine, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina, South Dakota, Texas, and Wisconsin. Those states, according to 2013 Census numbers, had about 103 million residents ? or roughly a third of the country’s population.