You don’t have to look far to see the major pressure being put on Governor Walker to accept an expansion of federal Medicaid dollars as part of Obamacare. From the Democrats and their allies in left-wing groups, to the editorial boards of newspapers like the Milwaukee Journal Sentinel, to other Republican Governors like John Kasich in Ohio, the pressure to accept the "free" Medicaid dollars is strong.
But as Media Trackers uncovered, the "free" Medicaid funds will not be "free" for Wisconsin taxpayers. Brian Sikma ably deconstructs the talking point that taking the Medicaid dollars will "save Wisconsin $65 million dollars" by looking at what the long term effects of the acceptance means.
The LFB was able to calculate a $65 million savings only by looking at the first three years of the expansion. During that time the federal subsidies will be at their height, and experts warn that over time the state will be required to assume more and more costs as the federal subsidies are drawn down.
One of the new costs Wisconsin would have to assume is the difference between the new physician reimbursement rates under the Affordable Care Act and the old rates, which would kick in around 2015. "By 2015, it would be up to Wisconsin to pay for the new reimbursement rates to primary-care physicians, or let reimbursement drop down to the old rates," writes Nina Owcharenko of The Heritage Foundation, a conservative policy center.
According to the comprehensive Kaiser Family Foundation study (PDF page 42), Wisconsin’s overall Medicaid costs will rise by $725 million if the program is expanded. Subsets of spending may or may not expand, but if the federal dollars are accepted the long-term result is a tremendous cost to taxpayers, not a savings.
The Medicaid expansion is just another example where "free" government money is never free.