Obamacare was sold as a collection of rich promises and benefits — a neatly wrapped gift with a bow on top. Twenty-nine months after Democrats rammed Obamacare through Congress, every state is learning the hard lesson that the federal government’s version of Christmas morning comes with a big price tag. The proposed Medicaid expansion alone threatens to completely reshape state budgets, crowding out investment in core state functions such as schools, public safety and transportation.
Here in Georgia — a million miles from Washington’s printing press — we are constitutionally bound to balance the budget. This common-sense constraint means Georgia cannot afford Obamacare. Unless Congress moves to give states more flexibility — such as through a block-grant program — it’s likely Georgia will opt out of the expanded Medicaid program.
To entice states to come onboard with the Medicaid expansion, the federal government is using an old trick: The first one’s free. But soon thereafter, the state’s on the hook for ballooning costs.
As such, states face an impossible choice. The federal government promises to pay the full cost of the new enrollees for Medicaid for three years. The free ride sounds good, but after that, we’re told, states will pick up a share of the expanded population, ratcheting up to 10 percent by 2020.
Realists must express some incredulity about whether our bankrupt federal government is actually going to cough up the money. Washington’s new costs in Georgia alone will amount to $40 billion over 10 years. Even if it does live up to its end of the bargain, there’s no money in state treasuries to cover our part of the bill. Put another way: If they’re buying lunch, we cannot afford even to pick up the tip — the bill is simply too large.
Changes to Medicaid will cost around $4.5 billion in additional state tax dollars over 10 years. Obamacare will add approximately 620,000 people to Georgia’s Medicaid rolls in 2014, meaning nearly 1 in 4 Georgians will be on Medicaid. States, Georgia included, will have to choose between job-killing tax increases and immense cuts that will dramatically impact public education and public safety.
Even before the expansion, Georgia struggled to pay the ever-increasing price tag for Medicaid, particularly as the recession has pummeled state revenues for years. For the 2013 and 2014 budget years, we face a $700 million shortfall in our Medicaid program — and that’s long before we have to start paying a 10 percent share on more than 620,000 new enrollees.
Unfortunately, Medicaid is just one challenge presented by Obamacare. Under the health care law, expensive employer mandates will stunt private-sector job creation, effectively blocking the only real path to sustainable economic growth.
As governor of Georgia, I have made it my goal to make Georgia the No. 1 place in the nation to do business. We’ve partnered with business leaders to increase Georgia’s competitiveness, and those efforts have been rewarded with a significant number of important economic-development announcements. The changes we have made have positioned us to beat peer states in the race for jobs and investment. Sadly, Obamacare so reshapes the global competitive landscape that our gains against peer states will prove small relative to the step backward all of America will take versus international peers.
Obamacare, with its vast catalog of complicated new rules, regulations and mandates, imposes unprecedented costs and uncertainties that downgrade America’s competitiveness. If allowed to stand, this singular piece of legislation will be the largest tax on job creation in the history of our nation.
Thus far, I have followed the pattern of most observers and commentators in defining the Obamacare challenge in terms of costs and competitiveness. While these concerns are well-placed, we focus on these “dollars and cents” issues at the risk of ignoring implications that I think are more troubling still. By requiring citizens to buy a product, Obamacare is an attack on self-determination and personal liberty. It runs counter to the bedrock principles and freedoms that have defined the American character and experience.
The best hope for saving Georgia taxpayers is change in Washington this November.
Gov. Nathan Deal is a Georgia Republican.