Will Republicans cave on Obamacare Medicaid expansion?
Executive Vice President Michael J. Reitz is cited in Thursday’s Wall Street Journal on the possibility that Republicans in the Michigan Legislature could be close to caving in on support for Medicaid expansion under Obamacare.
Here is a compilation of analyses and commentary on why that should not happen.
Center among dozens of groups promoting voluntary unionism
The Mackinac Center will be among dozens of local and national organizations in 30 states promoting National Employee Freedom Week June 23-29.
NEFW “is a national effort to inform union employees of the freedom they have regarding opting out of union membership and making the decision about union membership that’s best for them.”
NEFW will educate unionized employees on their options to stay a union member or opt-out of union membership to varying degrees. These include:
- To fully stop paying union dues if they are in a right-to-work state;
- To become an agency fee payer in a non-right-to-work state (or if they are waiting for a contract to expire so a recently enacted right-to-work law applies to them as many workers are doing in Michigan);
- Become a religious/contentious objector in a non-right-to-work state (or are waiting for a newly enacted law apply to them).
The sponsor of the week, the Nevada Policy Research Institute, a nonpartisan think tank based in Las Vegas, notes that “unionized employees often don’t know that they have the legal right to opt-out of union membership” and that NEFW “will help educate those employees on their options so they can make the decision about union membership that’s best for them.”
The NEFW’s website, http://employeefreedomweek.com, provides national resources to inform union employees about how to opt-out of their union membership. It also provides generic opt-out letters and highlights alternatives to union membership.
The website complements on a national level the Mackinac Center’s Michigan-specific worker rights website http://MIWorkerFreedom.org, which provides Michigan’s union members with detailed information on how our state’s right-to-work law affects them and how and when they can exercise their new rights.
NPRI on June 24 will release the results of a poll of union households in various states showing the percentage of union members who are interested in exercising their rights around the country.
Like Déjà vu all over again
In an attempt to thread the needle between Left and Right on Medicaid expansion, Michigan House Republicans recently unveiled House Bill 4714, which expands Medicaid to everyone earning less than 138 percent of the federal poverty level, but only if certain reforms are approved by the federal government.
Michigan's latest foray into Medicaid expansion is not new. Many states, in an attempt to overcome the federal government's "my house, my rules" funding dynamic, have proposed reforms — politically unlikely conditions, really — in exchange for taking federal Medicaid expansion dollars. But lawmakers in the Great Lake State may not fully realize the extent to which other states have tried — and failed — to get federal buy-in on similar reforms. Consider:
House Bill 4714 includes a financial trigger that rescinds Medicaid expansion if federal funding falls below 100 percent.
This trigger runs contrary to the federal health law itself, which promises states 100 percent federal funding for the first three years of expansion and then 90 percent federal funding starting in 2020 and beyond. And last week, the Centers for Medicare & Medicaid Services (CMS) rejected Maine's request for 100 percent federal funding in perpetuity. The CMS letter states that it "has no authority to change the matching rates by regulation or waiver."
Some health policy experts have also questioned whether a Medicaid trigger would even be enforceable, as the Supreme Court ruled only whether Medicaid expansion was mandatory for states, not whether a state can rescind the expansion without losing federal Medicaid funds altogether.
In other words, regardless of the Court's decision, the Patient Protection and Affordable Care Act statute remains in effect. And the statute says that the secretary of Health and Human Services has sole discretion to withhold federal Medicaid funds if a state fails to comply with Medicaid requirements.
Therefore, if Arkansas tried to exit expansion after the federal government failed to meet its commitments, there is a substantial possibility that a court could find that the Secretary of Health and Human Services has the legal authority to condition first-dollar federal Medicaid spending on the state's continuation in the expanded program. To put it bluntly: under this scenario, expansion is forever. Private-option boosters are free to point to the triggers in a private-option bill, but they have misunderstood how state legislation works if they think it trumps federal law and Supreme Court precedent.
Alt calls this the "Hotel California" effect of Medicaid expansion — states can check out of Medicaid expansion anytime they like, but they can never leave.
House Bill 4714 gives the Medicaid expansion population the option of an HSA-like account.
Indiana has gone down this road before. In 2008, Gov. Mitch Daniels implemented the Healthy Indiana Plan, a Medicaid expansion with a Health Savings Account-like component called a "POWER Account" used to purchase health insurance and health care services. Under the plan, Indiana would guarantee at least $1,100 in each POWER Account, but also require that Medicaid recipients contribute up to 5 percent of their income.
In 2012, CMS squashed Healthy Indiana's long-term future and instead gave it a one-year extension that expires at the end of this year. In its letter to Indiana state officials, CMS indicated that it is unlikely to extend any state program that covers low-income adults "in anticipation of the new coverage options available in 2014" (read: Medicaid expansion).
Now Gov. Mike Pence is proposing that CMS extend the Healthy Indiana Plan for another three years, with the possibility that the plan could become Indiana's Medicaid expansion coverage vehicle. But if CMS doesn't think Healthy Indiana should serve the childless adults currently in the program, it is unlikely that CMS will approve the same option for low-income parents as part of the Medicaid expansion — for Indiana, Michigan, or any other state.
House Bill 4714 gives the Medicaid expansion population the option for premium assistance to purchase coverage in the state health insurance exchange.
This provision mirrors Arkansas's "private option" that expands Medicaid by allowing the Medicaid expansion population to buy coverage on the state's forthcoming health insurance exchange.
Pro-private option Arkansas legislators like to point out that they are reducing the Medicaid rolls by putting more people on private coverage. Nothing could be further from the truth. Using this logic, you could also argue that the Supplemental Nutritional Assistance Program exists in name only because government dollars are used to purchase food at private grocery stores. Of course, this isn't the case.
The bottom line is this: Expanding Medicaid, whether through the traditional Medicaid program, a Health Savings Account, or exchange coverage, still is a massive expansion of the welfare state. More people will get government-subsidized health care that must comport with government rules.
CMS has reiterated that expanding Medicaid via exchange coverage is still a Medicaid expansion, and Washington holds all the cards. In an infamous Good Friday memo released in March, HHS Secretary Kathleen Sebelius confirmed that Medicaid coverage purchased in an exchange must look like traditional Medicaid coverage.
In other words, Michigan has no other option but to expand the Medicaid program exactly as it exists today, which other states have done with disastrous results. States can't vary Medicaid benefits or implement co-pays or other cost-sharing mechanisms that aren't currently allowed by federal law. If exchange benefits don't comply with current Medicaid requirements, states must provide "wrap-around" coverage at the state's expense.
Michigan lawmakers are playing a dangerous game when they propose politically unlikely conditions in exchange for an Obamacare Medicaid expansion. Reforms are certainly worth pursuing, but not at any price.
Republicans pushing more crony capitalism
Does Michigan have enough schemes for local governments to tax-and-spend without full democratic accountability, or could it use more?
Does it benefit the people of this state to expand the ability of local governments to borrow-and-spend on “business improvement” projects designed to benefit certain property owners more than the community as a whole?
When Republican candidates for the Michigan Legislature in 2010 promised the broad Tea Party movement that they would dial back the amount of crony capitalist empire-building in this state, were they just blowing smoke?
These are questions state representatives may want to consider as they consider Senate Bill 257, which passed the Senate in April and may be up for consideration in the House this week. Here’s how MichiganVotes.org described the bill:
Introduced by Sen. Mike Kowall (R), to expand the items that a “Business Improvement Zone” can spend money on, reduce the proportion of property owners in the district needed to impose a zone's tax-and-spending powers, increase the proportion needed to dissolve them, reduce certain notification requirements required to establish one of these zones, allow the "zone" to sell services to particular property owners, increase penalties for not paying the "special assessment" taxes it imposes, and make other changes. These zones may be created by owners of a majority of the property in a certain area (not the same as the majority of owners), and have the power to impose property taxes (special assessments) to pay for the debt they incur to pay for projects that are supposed to benefit the property owners. Passed in the Senate 35-2, Who Voted "Yes" and Who Voted "No”
Story mischaracterizes study on Michigan charters
A recent Huffington Post article calls Michigan’s public charter school sector “questionable” and spins the results of the most comprehensive study of these schools into something negative. Authors Joy Resmovits and Ashley Woods take issue with the references former Florida Gov. Jeb Bush made to a 2013 Stanford University report, claiming “the study of Michigan’s [charter] schools…is less definitive than [Gov. Bush] made it sound.”
The Stanford study says that the typical charter school student in Michigan made two months’ worth of learning gains annually in both reading and math compared to his or her peers in conventional schools. This finding was based on tracking individual charter school students’ test score growth over a five-year period and comparing these gains to those made by conventional school students who were similar in income, race, gender, English proficiency, special education needs, grade level and prior standardized test scores.
Resmovits and Woods acknowledge this finding, but then point out that the study also mentions that 80 percent of charters had average standardized reading test scores below the state average and the same was true for 84 percent of charters in math. The authors use this statistic — also referenced in a previous article by Resmovits — to characterize the Stanford study’s results on charter school performance in Michigan as a mixed bag.
This is either due to a poor understanding of the study, or an attempt to mislead readers. Indeed, CREDO Director Margaret Raymond said in the press release accompanying the study that it shows “…Michigan has set policies and practices for charter schools and their authorizers to produce consistent high quality across the state. The findings are especially welcome for students in communities that face significant education challenges.”
A snapshot comparison of charter schools’ average standardized test scores to the state average should not be weighted equally with an analysis that controls for a whole host of variables and tracks annual growth of individual students over many years. This simplistic comparison ignores the large impact socioeconomic factors have on a school’s average standardized test scores, which decades of research have borne out.
This statistic is also not very meaningful. Given the clear relationship between socioeconomic factors and student achievement, one should expect charters to have lower average standardized test scores. The Stanford study says that charter schools serve a larger portion of low-income students compared to the average for conventional schools — 70 percent to 43 percent, respectively.
Further, since no student is forced to attend a charter school, these schools’ existence depends on parents actively choosing to enroll their children. Charters, therefore, tend to locate in areas where parents are least satisfied with their state-assigned public schools. Not surprisingly, public schools with low standardized test scores tend to be the ones with which parents are the least satisfied, and students from these schools are the ones that are most likely to enroll in charter schools.
This poor interpretation of the Stanford study means that Resmovits and Woods are essentially criticizing charter schools for serving Michigan’s neediest students. All charters have room for improvement, to be sure, but the challenges they face serving a disproportionately large low-income student population should be taken into consideration when evaluating their performance, not ignored altogether. Based on the most rigorous and careful analysis ever done in Michigan, the results are clear: Charter schools are having a net positive impact on thousands of students in the Great Lake State
Oliver Porter, a nationally recognized expert on public-private partnerships, writes in today’s Detroit News how privatization can help Detroit and other financially distressed cities in Michigan, particularly with long-term debit associated with legacy costs.
House Budget and excess property tax refunds
House Bill 4228, Final 2013-14 state education budget: Passed 25 to 12 in the Senate
The final House-Senate compromise version of the K-12 school aid, community college and university budgets for the fiscal year that begins Oct. 1, 2013. This authorizes $13.361 billion for K-12 public schools (a record high in nominal terms), compared to $12.944 billion the previous year; $1.430 billion will go to state universities, compared to $1.399 billion the previous year; and $335 million to community colleges, up from $294 million. Of these amounts, $1.861 billion is federal money.
Some highlights include: A $30 per pupil "foundation allowance" increase for school districts, and $60 for ones whose spending is at the lower end. Spending on preschool programs will increase by $65.0 million to $174.6 million. Students in grades 5 to 12 will be allowed to take up to two online courses per term. Universities would get less money if they raise tuition more than 3.75 percent.
House Bill 4705, Refund excess property tax collected by school district on retired debt: Passed 36 to 0 in the Senate
To require a school district (Stephenson in the Upper Peninsula) that collected a property tax millage for bonds that were already paid off (retired) to transfer the excess revenue it collected to the state. The overcharge would then be given back to local taxpayers by reducing the amount of state education property tax on their next tax bill.
House Bill 4743, Allow local holiday fireworks regulations: Passed 107 to 1 in the House
To allow local governments to ban the use of "consumer fireworks" between midnight and 8:00 a.m. on the day before, day of, and day after a national holiday (in larger communities the allowable deadline would be 1:00 a.m. on New Years). The 2012 law legalizing these fireworks (which include firecrackers, bottle rockets, aerial spinners, Roman candles, etc.) essentially preempted local bans on their use at all hours during these holiday periods.
House Bill 4681, Repeal auctioneer registration mandate: Passed 84 to 21 in the House
To repeal a law that imposes a registration (licensure) mandate on auctioneers, which requires two years experience in the field and passing a test. A recent state report on occupational licensing recommended repeal, noting there have been no auctioneer-related public complaints to the state in the past three years. Nevertheless, existing auctioneers testified against the repeal, which among other things would remove an obstacle to new competitors entering the field.
House Bill 4228, Final 2013-14 state education budget: Passed 65 to 43 in the House
The final House-Senate compromise version of the K-12 school aid, community college and university budgets for the fiscal year that begins Oct. 1, 2013. See description and Senate vote above.
SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit http://www.MichiganVotes.org.
Senior Investigative Analyst Anne Schieber was a guest on “The Tony Conley Show” on WILS AM-1320 in Lansing this morning, discussing her story and video about cities adopting “cost recovery” ordinances in an effort to squeeze extra money out of law breakers by charged extra fees, particularly on cases involving drunk driving.
Center analyst calls them on it in Washington Times
Labor Policy Director F. Vincent Vernuccio writes in today’s Washington Times that unions should sacrifice some of their massive wealth to help shore up underfunded pension funds instead of seeking to reduce retiree benefits.
New data released by the Michigan Department of Education shows that the average public school teacher salary in Michigan increased slightly for the 2011-2012 school year to $62,631.
This was up 1.7 percent from 2010-2011 year, but 0.6 percent less than the all-time high of $63,024 reported by the MDE for 2009-2010.
These figures include both conventional school districts and public charter schools, but the difference between these two types of schools was large, according to the data. The average salary for charter school teachers was $42,864, while the average for just conventional school teachers was $63,094.
Below are the 20 districts (with more than 100 pupils) that had the highest average teacher salaries in the state:
 This figure is made of data from only about 15 percent of charter schools. Most charters contract with educational management companies that hire and pay their teachers, and these charters do not report spending money directly on teacher salaries.