For healthier hospitals and Maine, LePage should have listened

Gov. Paul LePage laughs as Paul Nickerson of Lewiston, a member of the Maine People's Alliance, interrupts a press conference at Central Maine Medical Center in Lewiston in September 2013.  LePage was at the Lewiston hospital to deliver a giant check  to mark the state paying off its MaineCare debt to hospitals. Sun Journal hoto by Russ Dillingham.

Gov. Paul LePage laughs as Paul Nickerson of the Maine People’s Alliance interrupts a press conference at Central Maine Medical Center in Lewiston in September 2013. LePage was at the hospital to deliver a giant check marking the state’s repayment of its MaineCare debt to hospitals. Sun Journal hoto by Russ Dillingham.

Readers of a certain age likely remember a television ad about an investment company that supposedly was so good that, when people heard its name, they quieted down and leaned in to try to hear its advice. Following the hush on airplanes and in restaurants, the ad’s tag line was delivered: “When E.F. Hutton talks, people listen.”

If you sit a bunch of government officials around a table, you’ll find that they disagree about many things but they all listen to someone: bond ratings agencies. Whether elected or appointed, they want a good bond rating for their town, city, county, state or nation. Strong bond ratings translate into lower interest rates and save money. They also listen to what ratings agencies say about key business and the economy as a whole.

But somehow Medicaid expansion opponents are ignoring a new report from one of the big three ratings agencies.

Fitch Ratings made it clear that the majority of states that expanded Medicaid under the Affordable Care Act made the right move.

Just over half the states expanded Medicaid, including ones run by conservative Republican governors in Arizona, Idaho and Ohio. Center-right Gov. Chris Christie of New Jersey, who came to Maine to campaign for Gov. Paul LePage and who has been traveling around the country to raise his profile for a presidential bid, also expanded Medicaid.

In a report entitled “ACA Beginning to Hurt Hospitals in States that Opted out,” Fitch advises, “We expect providers in states that have chosen not to participate in expanded Medicaid eligibility to face increasing financial challenges in 2014 and beyond.”

And for states that expanded Medicaid, there are already good fiscal impacts. According to the report, “Fitch is beginning to see the beneficial aspects to providers in ‘expansion states’ through improved payor mix and reductions in bad debt in the first quarter of 2014.”

Of the nine hospitals that had their finances upgraded, eight were in Medicaid expansion states.

With more people with insurance, hospitals are better off because fewer uninsured people are coming in who put off care until they were ill and in need of expensive treatment and hospitalization. As Kaiser Health News reported, the top “safety net” hospital in Seattle saw the uninsured rate drop from 12 percent to an astounding 2 percent. About half the number of uninsured patients showed up in similar hospitals in Colorado and Arkansas.

Hospitals in Maine, meanwhile, are laying people off.

And it’s not as if this couldn’t have been predicted. In fact, besides the politicians who opposed expanding Medicaid, the only person in Maine who argued that expansion wouldn’t help hospitals was Gary Alexander.

The initial Alexander report said Medicaid expansion wouldn’t lead to a decline in charity care because, it claimed, expanding coverage would cause people with private insurance to switch over to MaineCare.

As we know, Alexander’s work was so badly done that the governor’s office eventually stopped paying him — although not until what was first termed an attempt to “politicize punctuation” was identified by its real name: plagiarism. (Still, the governor who falsely claims that fraud by the poor is the norm will not try to get Alexander to repay the half million dollars in state and federal money he received.)

Expansion opponents proclaimed themselves friends of Maine hospitals for paying debt owed for uncompensated care, but expansion supporters also supported those payments.

To keep Maine hospitals financially healthy, Maine needs to lower the percentage of uninsured Mainers. While the ACA’s exchanges did increase insurance coverage in Maine, the states that expanded Medicaid did much better in covering more people.

Maine hospitals, which supported expansion, were also hurt by LePage’s refusal to guarantee bonds, thus making borrowing more costly.

LePage’s press conference with a giant check for hospitals made for good theater, like dumping ice water on one’s head rather than restoring massive cuts in medical research.

But when LePage and nearly all Republican state legislators blocked Medicaid expansion, tens of thousands of Mainers were left without health coverage and at greater risk for serious illnesses, preventable deaths and medical bankruptcies. Maine hospitals have also been undermined.

Now financial honchos say what they could have known, if they had only listened.

Amy Fried

About Amy Fried

Amy Fried loves Maine's sense of community and the wonderful mix of culture and outdoor recreation. She loves politics in three ways: as an analytical political scientist, a devoted political junkie and a citizen who believes politics matters for people's lives.