A majority of small business owners oppose expanding Medicaid coverage under Obamacare as proposed by Governor Snyder in his recent budget address.
However well intended the policy, small business owners – surveyed by my employer, the National Federation of Independent Business (NFIB) – fear that the federal government will renege on their funding commitments and stick Michigan with a greater portion of the cost. They also believe that expanding entitlement programs like Medicaid create more dependency and discourage people from seeking better jobs and opportunities.
The Affordable Care Act (aka, “Obamacare”) included a requirement that states expand Medicaid eligibility for all individuals and families up to 133 percent of the Federal Poverty Level. However, a recent U.S. Supreme Court decision allows states to opt out of the Medicaid expansion requirement. Governor Snyder has proposed going along with the expansion and setting aside projected savings from patients that are now covered by state general funds that would be covered by federal funds under the expanded program. The savings set aside would be used to cover the eventual 10 percent that Michigan would have to cover after federal funding is reduced down the road. Snyder says that his plan provides funding for 100 percent of the Medicaid expansion until the year 2035.
When asked if Michigan should expand Medicaid as allowed under the federal Affordable Care Act, 67 percent of those surveyed said NO, 22 percent said YES, and 11 percent were undecided. Snyder’s approach of banking savings to offset future program costs is less negative than similar Medicaid expansion surveys conducted in other states.
But while the governor and his team deserve credit for trying to structure the expansion to anticipate and address future funding reductions by the federal government, businesses are skeptical of assumptions that depend on the budget discipline of future lawmakers – and governors.
To view the survey question go HERE.