Unintended Consequences of PPACA

State budget problems are so dire and rising health care costs so worrisome that some states are considering what may have been unthinkable just a year or two ago — opting out of the federal Medicaid program. The New York Times reported last week that Texas and a handful of other states are considering doing exactly that, especially given that federal health care reform will expand (as of 2014) the number of residents who are eligible for the state-administered health care program.

In South Carolina, state officials there are considering not paying Medicaid claims as of March 2011 unless they can secure permission to run at a deficit. Some state leaders concede dropping Medicaid could have a devastating effect on their local economies, making such a course unlikely.

The fact that it’s on the table, however, speaks volumes about the growing problem of runaway health care costs, and the need to develop systematic solutions in the way that the Patient Protection and Affordable Care Act (PPACA) addressed access issues.