Aubrey Layne column: The fiscal case for Medicaid expansion

However, as we examine this issue through the lens of the potential impact on our health care system and the families it serves, we should also consider the responsibility public officials have to look at the numbers and make the right decisions for taxpayers, regardless of the politics.

Before I served as a Cabinet official, I spent much of my career as a certified public accountant and financial officer for private companies.

I am trained to assess issues, such as expanding health care coverage, not as a health care professional or policy specialist but as a CPA. CPAs who come to government often view problems first and foremost through a fiduciary lens — the lens of people whose financial responsibility is to protect and enhance the interests of Virginia taxpayers and stakeholders.

Since the passage of the Affordable Care Act in 2010, the federal government has collected additional taxes exceeding $2 billion annually from Virginians. These taxes are federal law, and our citizens cannot opt out of paying them. But unlike other federal taxes, we do not get back the full benefit of these dollars unless we elect to expand coverage.

Because Virginia has chosen not to expand Medicaid, our ACA tax dollars are going to other federal programs, and not benefiting Virginia taxpayers by offsetting health care costs for eligible participants. We continue to incur these health care costs regardless of whether we accept the ACA monies.

That reality makes the business case for expansion unimpeachable.

Virginia is leaving more than $2 billion on the table each year — money Virginians have paid in federal taxes — that we could be collecting from the government if we expanded Medicaid. That money would more than reimburse the $100 million the state spends annually on uncompensated hospital care.

A financial officer’s role is to protect the assets of the organization and deliver value for shareholders and owners. From a fiduciary perspective, state taxpayers are shareholders of the commonwealth. A substantial majority of those shareholders want to expand Medicaid coverage to secure the associated federal tax dollars. Any private-sector financial manager who ignored the wishes of shareholders, particularly after determining that their wishes were financially sound, would be justifiably fired by his or her board. Period.

The fiscal case for expansion is made even stronger by the structure of the plan supported by Gov. Ralph Northam and a majority of Republicans and Democrats in the Virginia House of Delegates. That plan requires Virginia’s hospitals, which would benefit financially from expansion, to cover the commonwealth’s 10 percent share of the costs of expansion while the federal government covers the other 90 percent. That means the commonwealth’s obligation would be 100 percent covered without using general fund resources.

The Northam administration has listened carefully to understand the perspective of people who resist expanding Medicaid coverage in Virginia. We routinely hear the same two arguments: first, that the federal government cannot afford this program; and second, that the current administration will reduce funding for the program.

Neither argument withstands logical examination. The United States federal government is rated AA+ by the major credit rating agencies. Such credit ratings are only assigned to creditworthy organizations, not ones that cannot pay their bills. In fact, Treasury bonds issued by the federal government are the go-to investment for investors seeking a secure place to put their money.

With respect to the concern about a reduction in funding, it is important to remember that the Affordable Care Act is the law of the land. The funding for Medicaid expansion cannot change unless Congress acts to change it. And in the unlikely event that Congress does just that, the proposal currently on the table includes an automatic mechanism that would end Medicaid expansion if federal funding is reduced.

If this were an education program, or a transportation program, most legislators would agree that securing those federal dollars is in the best interest of Virginia. Why should a health care program be any different? The clear answer is that it should not.

The governor, House Speaker Kirk Cox, and leaders from both chambers and both parties are correct: It is time for Virginia to stop squandering this opportunity. We need to listen to our taxpayers, expand coverage, and receive the benefit of billions of dollars in federal funding. Those dollars will free up monies for core services and cash reserves to help ensure Virginia’s credit rating remains AAA. As financial stewards who hold the responsibility for the state budget in our hands, we have a duty to act.