Kasich Takes Obamacare’s ‘Free Money’

Ohio governor John Kasich


Ohio governor John Kasich has joined the dishonor roll of Republican leaders backing an expansion of Medicaid under the Affordable Care Act. Our earlier criticism of Arizona governor Jan Brewer applies equally to the case of Ohio: The governor has allowed himself to be bought off by the false promise of “free money” from the federal government.

Acceding to the Medicaid expansion, Governor Kasich reasons, “avoids leaving Ohioans’ federal tax dollars on the table and keeps the federal government from simply giving them away to other states.” Kasich does have a kernel of a point; in general, fiscally conservative governors should not be expected to decline benefits while their constituents’ federal tax dollars continue to fund such benefits in liberal states. The critical difference between the Medicaid expansion and most other federal subsidies is that governors are in a position to resist the expansion of Medicaid if they so choose: The Supreme Court has made it abundantly clear that the federal government may not coerce the states into cooperating with the Medicaid expansion, and if enough states opt out, the expansion cannot work. Governor Kasich is marching in the Obamacare parade by his own volition.

Federal health-care spending in aggregate is the major driver of our national deficits going forward, and Medicaid is no small part of that problem. But the perverse structure of the Medicaid expansion under Obamacare makes spending attractive: Like a street-corner drug dealer, Washington offers the first taste of Medicaid expansion for free, picking up 100 cents on the dollar of the costs. Afterward, the states will be expected to pick up at most 10 percent of the cost, again creating the illusion of something for nothing.

But as the federal debt grows, Ohio’s taxpayers will be on the hook just as much as those of any other state. Somebody, somewhere, has to say, “No.” Saying “no” to wasteful government spending is purportedly a very large part of what Republicans seek elected office to do. Governor Kasich had the opportunity to do so, but instead decided to take the money and run. Because Kasich is the governor of a large and politically important state, his example is a particularly unhelpful one with other Republicans still on the fence.

Medicaid is a fiscally disastrous program that provides questionable benefits; studies routinely indicate that patients on Medicaid have health outcomes inferior to those who have no coverage at all. As it stands, Medicaid already costs nearly twice as much annually as the Iraq War did in its most expensive year ($258 billion vs. $140 billion), and the program is rife with fraud. It is in fact precisely the sort of wasteful and counterproductive program that intelligent governors of both parties should be seeking to reduce rather than to expand.

Leadership means taking a long view of things and forgoing the easy thing for the necessary one. Governor Kasich’s participation in the expansion of Medicaid fails the test of leadership on both counts. And while the politics of taking that “free money” from Uncle Sam might appear attractive in the moment, the bills will come due — the bills always come due, as they will for the taxpayers of Ohio and Arizona. Like Governor Brewer, Governor Kasich has sold himself and the people of his state far too cheap.