Critics say state health care exchange will hurt low-income residents

The N.C. General Assembly’s move to reject the expansion of Medicaid has drawn the ire of those who say it will disproportionately affect low-income residents.

The N.C. House voted Tuesday to permit the federal government to set up a state health care exchange and to not accept federal money to expand Medicaid. The Senate already approved the bill, meaning it will now head to Gov. Pat McCrory’s desk.

The Affordable Care Act mandates that states establish health care exchanges to offer plans to small businesses and uninsured individuals, as well as potential tax credits and subsidies for coverage.

The exchanges can be run by states, the federal government or both, through a joint partnership.

The law called for expanding Medicaid to those living 133 percent of the federal poverty line, with the U.S. government paying all of the costs for three years and the state shouldering a small portion of the cost thereafter.

The expansion of Medicaid would have covered about 500,000 more people, according to a report by the N.C. Institute of Medicine.

But last summer, the U.S. Supreme Court ruled mandatory expansion to be unconstitutional, and since then, many states with Republican governors have decided against expanding Medicaid.

“The expansion of Medicaid is a bad deal for federal taxpayers and state taxpayers,” said Dallas Woodhouse, state director of Americans for Prosperity.

“We are proud of the leadership in the legislature and governor.”

Legislators opposed to the expansion and potential costs have previously cited a state Medicaid audit — which found that inadequate oversight of the program resulted in a shortfall of more than $400 million last year.

But Sen. Floyd McKissick, D-Durham, said the measure is short-sighted and will harm both hospitals and the uninsured.

“We have an uninsured population, we have those same people getting care at hospitals and hospitals will be more hard-pressed,” McKissick said.

He also said turning down money from the federal government would not provide the state with the economic benefits of expansion.

“That means less money to stimulate the economy to provide jobs,” he said.

Don Dalton, spokesman for the N.C. Hospital Association, said admitting the uninsured results in higher uncompensated care costs and more debt for hospitals.

“We can’t get our services back even if we wanted to,” he said. “So we have to charge those accounts to bad debt.”

Still, Dalton said hospitals in the state would continue to provide care for the uninsured.

“We are going to continue to serve everyone,” he said. “We are the community safety net.”

Contact the desk editor at state@dailytarheel.com.