Health and Human Services Director agrees with the Policy Council

Our coverage of the health care debate, beginning in October of last year, dispelled the myth of a free market health exchange and highlighted the growing costs associated with the Affordable Care Act, or Obamacare.  It appears the Director of the Department of Health and Human Services (HHS) is on the same page as we are, according to testimony heard this week during a Senate Finance Committee meeting.  During his budget presentation, Director Tony Keck alluded to the current health care system as one of the most expensive and that, due to the passage of Obamacare, costs will not only continue to spiral out of control – they may soon become practically unsustainable.

One interesting fact to point out is that 80% of the current HHS budget is devoted to meeting maintenance of effort requirements for federal grants and programs such as Medicaid.  In addition, we are seeing a substantial increase in new enrollees with levels of participation in future years continuing to grow at accelerated rates.  This will negatively contribute to the already overwhelmed funding obligations associated with the health care system.

According to the Director, if the Supreme Court upholds Obamacare, the state will most likely see an additional 1.8 billion dollars devoted to health care by the year 2020.  He also stated, as we pointed out last year, Obamacare does nothing to control costs of the health care system.  Rather, it merely adds people to Medicaid and private insurance companies.

With the overall state budget comprised of about 40% federal dollars, the time to start making serious decisions regarding budget priorities has come and gone.  State agencies such as HHS, the Department of Transportation, and the Department of Education, are all primarily funding through federal dollars.  As we’ve pointed out, accepting these federal dollars obligates the state to enforce federal standards and spend state money on projects prioritized by the federal government.  Apparently, the Director of Health and Human Services is experiencing this first hand.

Stay tuned for more budget updates at the Senate Finance Committee completes their budget discussions and presents the legislation on the floor in the coming weeks.

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Category: Budget Watch 2012 · Tags: