Down in Concord

“The government solution to a problem is usually as bad as the problem and very often makes the problem worse.” — Milton Friedman

The House is not in session this week or next. Many members will be busy in Committees of Conference trying to resolve differences between House and Senate versions of bills. Each conference committee crafts a compromise on one bill, then submits the compromise bill with explanation to both the House and the Senate by June 20. This year there are 26 bills headed to conference. The biggest and most important bills are, of course, the budget bills.  On June 26, the House will vote on conference committee reports, and that should be their last session of the year.

Most of the bills other than the budget bills will be of little interest to most people. (Does a bill “consolidating the property appraisal division and the municipal services division of the department of revenue administration” interest anyone?) Most people probably aren’t particularly interested even in the budget bills – for the simple reason that most people have little interest in anything to do with politics.

There is one bill that might interest quite a few people. And that is the Medical Marijuana bill, HB 573. The House approved it by an overwhelming bipartisan majority, but the governor said she had problems with parts of the bill, so the Senate amended it, and then passed it by a 3-1 bipartisan majority. Advocates of medical marijuana no doubt will be contacting their representatives trying to influence the conference committee.

Down in Concord, the most difficult, time-consuming, and important conference will be on the budget. The numbers aren’t all that different – the Senate increases spending by 7%, the House increases by 10%. The Senate spends $23 million more than the House on the Department of Health and Human Services. Governor Hassan labels that increase a “devastating cut”.

In the State House there is an Office of Legislative Budget Assistant (LBA), staffed with professional number crunchers. One of the many documents they produce is a line by line – 1611 pages worth – comparison of the House and Senate budgets. One column shows the dollar difference between the two versions. On page after page after page the difference is zero. I managed to get through about 800 pages before I ran out of energy. It is fair to say that over 90%, perhaps closer to 99% of the spending proposals are identical.

The numbers aren’t the problem. The contentious debate won’t be about a million here, a million there. The debate will be about expanding Medicaid to cover not just the poor but people with incomes up to 138% of the federal poverty level. Proponents say that it will help thousands of poor people, that it will cost us nothing because the federal government will pay 100% of the cost for three years.

Opponents reply that “If it sounds too good to be true, it probably is.” There are always unintended consequences from any program, especially from a federal government program. Let’s look at the long-term effect of this program.

People often complain that politicians rarely plan beyond the next election. Well, the New Hampshire Senate is now saying let’s look beyond the two years of this budget to study whether this program will be good for the long term.

Politicians all too often judge a program by its intentions, not by its results. They feel good for how much money they spend, rather than how many people are actually better off. They create some new program, congratulate themselves for how well it will work, but only rarely measure the results of the last program they created.

Supporters of expanding Medicaid live in a fantasy world where every program works as intended. Let’s look at the real world.

A study of 13,000 Oregonians conducted by Harvard and MIT economists and recently published in the New England Journal of Medicine concluded that “Medicaid coverage generated no significant improvements in measured physical health outcomes in the first two years.”

A University of Virginia study of 1 million surgeries showed Medicaid patients were twice as likely to die as those with private insurance. The same study showed that compared to NO insurance, Medicaid patients were 13% more likely to die.

A Journal of Cancer article showed that Medicaid cancer patients are two to three times more likely to die than other patients.

Our neighboring state of Maine 11 years ago decided to expand its Medicaid coverage. Supporters thought it would reduce the number of uninsured, thus reducing the costs of uncompensated care. A decade later, the number of uninsured was unchanged at 12 percent. Medicaid participation grew 7 percent but private health insurance dropped by 7 percent. The main effect of expanding Medicaid is shifting people from private insurance to government insurance and sticking taxpayers with the bill.

Medicaid is a program of low quality and high cost – not just in dollars but also to the well-being of the recipients of poor care. If we truly care about people who need help – not just feeling good about throwing money at a problem – we should try to find a replacement, not expand Medicaid.