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Losing Healthy Michigan will make economy sick

The new health care law will mandate that people buy some form of insurance.
Steve Carmody
Michigan Radio
The new health care law will mandate that people buy some form of insurance.

I have an idea. This should especially appeal to everyone who either didn’t like President Obama, or thought there were flaws in his signature achievement, the Affordable Care Act. Let’s get even by taking health care away from 650,000 Michiganders with lower incomes.

Now, granted, this will have repercussions.

Jack Lessenberry

More than three years after the Affordable Care Act – Obamacare -- was passed by Congress, Michigan used one of its provisions to expand Medicaid to Americans who are still by any measure poor, but not quite below official poverty levels.

We’re talking about providing health care to folks who make no more than $33,000 for a family of four. Here, that’s called the Healthy Michigan Plan, and by any measure, it has provided a tremendous boost for our state’s economy.

Governor Rick Snyder barely managed to get it through the legislature, in part by arguing that it would provide employers with a healthier workforce. It has indeed done that – but it has paid other dividends as well.

In fact, the Healthy Michigan plan is having a positive net impact on the state’s economy that is in the billions – much of it going to the private sector.

Here’s just one hard fact. The year before the Healthy Michigan plan kicked in, Michigan hospitals spent $627 million dollars on uncompensated care they provided free of charge to the poor and the sick. The year after Healthy Michigan kicked in, that had fallen by exactly $300 million. That’s money often struggling hospitals have that they didn’t have before.

Since the number of those signed up for Healthy Michigan has continued to grow, those savings are almost certainly even greater now.

Most of the costs of the Healthy Michigan plan are being paid for by federal, not state government. But on balance, it isn’t costing the taxpayers anything. A University of Michigan study published in the New England Journal of Medicine in January indicated that the positive economic effects of this Medicaid expansion will generate more than enough money for the state budget to cover the costs of the entire program for at least the next five years.

I suppose, if you were one of those bleeding heart liberals, you might say something to the effect that the program would be worth it in any event, because it means people, many of them children, are healthy who would otherwise be sick.

But I’ve been concentrating on the benefits that even Ebenezer Scrooge would love. The U of M study found the ripple effects of Healthy Michigan generate more than 30,000 new jobs every year – most in the private sector. They generate billions in spending power and hundreds of millions in tax revenue. This has been a tremendous boon for our state.

However, it is now seriously threatened. Republicans in Congress unveiled a proposed replacement for Obamacare this week which is difficult to understand, but is clearly not as good for lower income Americans. It would apparently also mean the gradual end of Healthy Michigan, since no one new could sign up for the program after 2020.

This would obviously be an economic and human disaster for our state. You might want to read as much as you can about this, and then let your Congressman know what you think. Before, that is, it’s too late.

Jack Lessenberry is Michigan Radio’s Senior Political Analyst. Views expressed in his essays are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.

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