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Obamacare has left employers with little choice but to accept the expansion of Medicaid, says Missouri Chamber

JEFFERSON CITY – Again voicing its underlying opposition to the federal Affordable Care Act, the Missouri Chamber warned Missouri employers that without approving the expansion of Medicaid, the business community will be left holding the bag on $3.5 billion in cost shifts from hospitals. The Missouri Chamber hosted a press conference today where the Missouri Hospital Association presented a study that outlines the significant burden on employers that could result from health care cost shifting if Missouri fails to expand Medicaid.

“Our hands have been tied by Obamacare,” said Mehan. “We don’t like it, we don’t agree with many of the tenants of it, but Obamacare is law and whether we like it or not, we have to abide by it. The only choice we have is to decide if it is going to cost the employer community a lot, or a whole lot more. That’s where we are.”

According the study by the Missouri Hospital Association, hospitals will experience $4.2 billion in cuts between 2013 and 2019 under Obamacare. Obamacare was designed to provide fewer dollars to hospitals for uncompensated care as a trade-off for states to expand the Medicaid program and other insurance options through health insurance exchanges to make up that difference.

“However, when the Supreme Court ruled that the federal government could not cut off funding for existing Medicaid for states declining to take part in the expansion, the rules of the game changed,” Mehan said. “Now hospitals are looking at significant cuts, without receiving the additional Medicaid funding if state lawmakers choose not to expand it. And how will they recover those costs? Health care facilities will recoup costs by charging more for privately insured patients in order to cover the losses by treating Medicaid and Medicare patients and the uninsured.”

The MHA study calls this cost shift the “hidden health care tax.”

“Who will ultimately pay the hidden health care tax?” Mehan asked. “Since the vast majority of privately insured patients receive their coverage through their employer, ultimately it is the employer that will be paying the cost of this poor public policy.”

According to the study, Missouri hospitals provided $10.5 billion in uncompensated care throughout the past decade. Growth in uncompensated care exceeded 90 percent between 2002-2011. Per capita growth in uncompensated care exceeded 80 percent.

The Missouri Hospital Association study puts the hidden tax in perspective. The decision to expand Medicaid carries the potential to reduce the “hidden health care tax” by $1,300 per privately insured Missourian by 2021.

“The potential cost of uncompensated care as a result of Obamacare would be staggering for Missouri employers and individuals,” said Mehan. “This poor policy has Missouri employers over a barrel. We have no choice but to expand Medicaid, or face millions in a hidden health care tax.”

The Missouri Chamber of Commerce and Industry (www.mochamber.com) was founded in 1923 and is the largest business organization in Missouri, representing almost 3,000 employers, providing more than 425,000 jobs for Missourians.