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Ohio’s Obamacare expansion has already cost over $2 billion

By   /   January 29, 2015  /   News  /   No Comments

By Jason Hart | Ohio Watchdog

Ohio Gov. John Kasich’s Obamacare expansion blew past projections in its first year, putting 471,452 Ohioans on Medicaid and costing taxpayers $2.1 billion.

Because enrollment has so dramatically exceeded Kasich administration estimates — the governor expected 366,00 to enroll by July 2015 — the Obamacare money appropriated to pay for program benefits will be exhausted months early.

If recent enrollment and cost trends persist, Kasich’s Obamacare expansion will be more than $1 billion over budget by the time Ohio’s 2015 fiscal year ends on June 30. Actual Obamacare expansion claim expenditures reported by the Ohio Department of Medicaid are shown below.

oh-medicaid-expansion-cost-2014

In 2013 after Kasich, a Republican, unilaterally expanded Medicaid to able-bodied, working-age adults with no dependent children, his Medicaid director asked the Ohio Controlling Board to accept Obamacare funds for the expansion. Controlling Board members were warned the state Medicaid program would go bankrupt if they refused.

Led by a Kasich appointee, the quasi-legislative panel approved the Ohio Department of Medicaid’s request to appropriate $2,561,200,000 for Kasich’s Obamacare expansion. The new federal spending was meant to cover benefit costs from Jan. 1, 2014 through June 30, 2015.

Based on Ohio Department of Medicaid expenditure reports, the state paid out $2,124,778,839 in Obamacare expansion claims from January through December of 2014. With enrollment racing farther ahead of state projections each month, monthly spending increased sharply throughout the year.

Benefit payments for Kasich’s Obamacare expansion cost taxpayers $301,628,170 in December, $288,605,185 in November and $290,359,524 in October. Program expenditures averaged $266 million per month for the first six months of the 2015 fiscal year.

Unless Kasich’s Obamacare expansion abruptly breaks from a year-long trend, appropriated funding for the program will run out within the next month. The governor’s Office of Health Transformation did not immediately respond to Ohio Watchdog questions about how this might be addressed.

The federal government is currently paying 100 percent of benefit costs, but the State of Ohio will be on the hook for 10 percent by 2020. With the national debt exceeding $18 trillion and Republicans in control of Congress, federal matching funds for the Obamacare expansion are likely to be cut sooner.

Kasich is well aware of the national debt, and has recently been traveling to other states calling for a balanced federal budget. He promoted the Obamacare expansion during several stops on a six-state Balanced Budget Forever tour this month.

Enrollment in Kasich’s Obamacare expansion is expected to continue growing, but even at current enrollment it would cost Ohio taxpayers $360 million per year to cover just 10 percent of the program’s benefits.

“We’ve now substantially flown by Governor Kasich’s original and revised estimates for enrollees. With a cost nearing $8,000 per year per enrollee, the tab for Ohioans in just two years is getting bigger by the month,” Matt Mayer, president of free-market think tank Opportunity Ohio, said in an email to Ohio Watchdog.

“Should Governor Kasich’s balanced budget amendment project succeed, Ohioans will get stuck with an even greater bill, as the federal deficit spending that currently funds Medicaid is slashed,” Mayer added. “God forbid we go into recession driving enrollment even higher and state revenues down.”

“Contrary to Governor Kasich’s view, the best course of action is not to hasten the fiscal collapse of the federal government by increasing deficits and the national debt, thereby guaranteeing states will be forced to carry a greater share of the costs and taxpayers will be hit with higher taxes as part of an entitlement ‘reform’ package,” Mayer wrote in an Opportunity Ohio policy brief published Thursday.

“As a wise man once said, when you find yourself in a hole, the best thing to do is stop digging,” he concluded.

The governor is expected to include a continuation of his Obamacare expansion in the proposed 2016-2017 budget his office will release Monday. A two-year appropriation for the expansion would likely cost federal taxpayers more than $6 billion.

Ohio House Speaker Cliff Rosenberger, a Clarksville Republican, has signaled surrender to Kasich on the Obamacare expansion.

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Jason is an Ohio-based reporter covering labor issues for Watchdog.org, with a focus on right-to-work, public employee unions and Obamacare. Before joining Watchdog, Jason was communications director for Media Trackers Ohio. His work has been featured at FoxNews.com, Hot Air, The Daily Signal, RedState, Townhall and elsewhere. His investigations into labor union spending and Obamacare's Medicaid expansion have been cited by national commentators including Jim Geraghty, Michelle Malkin, Erick Erickson, Dana Loesch and Mark Levin. Jason can be reached on Twitter at @jasonahart and by email at jhart@watchdog.org