Evaluating policy costs and benefits not only confuses voters, but also the policymakers who craft those policies. Well-meaning elected officials often champion what seem like prudent actions, though unintended consequences may cost taxpayers and society much more. North Carolina’s failure to expand Medicaid and restore decent unemployment benefits are useful examples. Voters should carefully weigh the full benefits and costs when marking ballots on Nov. 3. (Another good example is Trump’s 2017 co
rporate tax cuts that purported to “pay for themselves” but failed to create promised growth, driving up fiscal deficits.)
In considering, and rejecting, Medicaid expansion, N.C.’s legislators perhaps did not know they were indirectly causing deaths. The poor and uninsured forgo preventive care, which may worsen chronic conditions such as cardiovascular problems or dia
betes. The Center for Budget and Policy Priorities, a D.C.-based research center, estimates that 1,400 North Carolinians between the ages of 55 and 65 died due to unaffordable care between 2014 and 2017.
At the polls, think about those deaths.
Evidence from the 39 states and the District of Columbia that have widened eligibility demonstrates the benefits of improved access to care. Positive effects also include greater financial security and employment gains. Add to those benefits the taxpayer dollars saved through reduced costs for uncompensated care and the expansion looks like a spending win. It would also help rural hospitals, which are closing at alarming rates. Health Affairs reports that the expansion covers childless adults earning less than $17,236, and helped cut rural hospitals’ uncompensated care costs.
That stabilizes finances.
The federal government pays 67 percent of N.C. Medicaid costs now; after expansion the share would rise to 90 percent. The federal match offsets much of the cost, according to the N.C. Justice Center’s Budget and Tax Center. A healthier population with better financial and job prospects means that taxpayer-funded state agencies will save money. Higher reimbursement rates, fewer uncompensated mental health services, and direct payments for service and treatment for the incarcerated are a few of those savings.
When people lack insurance, they forgo medical care, which drives up treatment costs because it sends them to emergency rooms and possibly hospital beds, more expensive than getting regular checkups. In North Carolina, the General Assembly has rejected federal dollars for expansion since 2013, according to the N.C. Justice Center. Some 194,000 state residents make too much to qualify for Medicaid but not enough to receive a subsidy. Seven rural hospitals have closed since 2013; others struggle financially. Uninsurance disproportionately burdens people of color. Another interesting benefit: In Medicaid expansion states, private insurance premium rates are 7 percent lower, on average.
North Carolina is practicing a false economy in failing to expan
d Medicaid and bolster unemployment benefits (see our September 20 Commentary.) Both policies would deliver benefits.
There’s more. At the federal level, the U.S. economy would recover more quickly under a “blue wave,” according to Moody’s Analytics, because the plan front-loads investments in people—spending on infrastructure, education, healthcare, and other social programs, which brings full employment back more quickly, post-pandemic; it also channels money to those who need money at a time when we need spending. Spending makes up 70 percent of U.S. gross domestic product. In a recession, increased personal spending lifts all boats.
“Trump’s economic policy, such as it is, improves the lot of rich people
, who have a low ‘propensity to consume,’” says Greensboro-based economist Andy Br
od. “There’s nothing wrong with saving, but spending is what drives the economy.”
One more consideration: Economic recessions over the past 50 years have fallen under Republican administrations, though President Obama inherited the financial-crisis fallout, the 2007-2009 recession. Republicans spend as freely as Democrats do, notes economist Nouriel Roubini, but won’t raise taxes to pay for it.
Betty Joyce Nash reported for the Hendersonville Times-News and the Greensboro News & Record before moving to Virginia where she worked as an economics writer at the Federal Reserve Bank of Richmond. She co-edited Lock & Load: Armed Fiction, published in 2017 by the University of New Mexico Press; the anthology probes Americans’ complicated relationship to firearms. Betty Joyce Nash writes for Carolina Commentary. For more information, see www.bettyjoycenash.com