Category: Health Care

When it comes to the percentage of its population on Medicaid, New Mexico is at the top of the heap. An astonishing 44 percent of our state’s population is on Medicaid. This is a costly situation for taxpayers in the other 49 states who pick up nearly $5 billion of the program’s annual $6 billion cost in New Mexico.

While the Rio Grande Foundation spends a bulk of its time working to reform the Medicaid program itself, this does not mean that new technologies and/or improvements in the health of our population couldn’t have positive impacts on Medicaid spending.

According to the Centers for Disease Control (CDC), 480,000 people die from smoking in the United States alone every year. This is one of the leading preventable causes of death and disease in the nation. Yet, 37 million Americans continue to smoke, including more than 278,000 adults in New Mexico. The prevalence of smoking in New Mexico has a direct impact on taxpayer-funded health programs such as Medicaid, with an estimated cost of more $223 million on an annual basis.

Vaping is a leading alternative to cigarette smoking. The health effects of vaping are being studied and debated, but study after study has shown vaping to be far safer than smoking. The Royal College of Physicians and Public Health England have concluded that the use of current vapor products represents no greater than 5% of the risks of combustible cigarette use. That is because without combustion that results from lighting tobacco on fire, you remove most of the harms associated with cigarette use. A wide range of products in the U.S achieves this result, ranging from products currently on the market to products under review for future approval by the FDA. There is promise in a number of technologies that reduce the harm associated with cigarette use, even for those who can’t completely kick the habit of nicotine use.

There is already recognition in the U.S. that this could reduce cigarette use, resulting in taxpayer savings and increased public health. Mitch Zeller, director of the FDA’s Center for Tobacco Products has explained, “Newer and more novel forms of delivering nicotine… could be incredibly helpful to curtail cigarette smoking if (smokers) completely switched.”

“At the end of the day, it’s not the nicotine that causes disease and death,” Zeller continued. This may be part of the reason that vaping other smoke-free alternatives has risen in popularity among adult smokers looking to quit. According to a 2015 report from the CDC, nearly 48 percent of current tobacco smokers said they had tried e-cigarettes at least once. Among those who recently quit smoking, more than 55 percent said they’d tried the devices.

In other words, large numbers of Americans are already using e-cigarettes and vaping as a replacement for the far more harmful activity of smoking traditional cigarettes. Tens of millions of American smokers, however, may be looking for even more reduced risk alternatives to cigarettes and may not have found vapor products on the market that work for them. For that reason alone it is critical for the Food and Drug Administration (FDA) and the federal government in general to approve as many potential lower risk alternatives to cigarette smoking as possible. It is important that as Mitch Zeller has noted, “We have…an open mind.”

Better health outcomes for everyone and reduced Medicaid expenditures for taxpayers in New Mexico and throughout the nation; that is the very definition of a win-win. It is time the federal government and the FDA in particular work to expand access to cigarette alternatives like vaping rather than slowing the technology and its spread.

Paul Gessing is president of New Mexico’s Rio Grande Foundation, a non-partisan, tax-exempt research and educational organization dedicated to principles of limited government, economic freedom and individual responsibility.

Recently, U.S. Rep. Michelle Lujan-Grisham joined supporters of Obamacare in protesting the possibility that President Donald Trump will repeal or dramatically alter the law. She is not alone. Liberals are hoping to defend Obamacare, despite public-opinion polls, which continue to reflect majority opposition.

There are many (and often, conflicting) aspects to Obamacare, but if Lujan-Grisham truly represented the best interests of New Mexico, she’d be working as hard as possible to at very least reform the Medicaid portion of the law – which will bankrupt our state if it is not reformed quickly.

It is well-known that New Mexico is facing budget shortfalls. These problems are due to a combination of falling oil and gas prices and anemic economic growth.

However, it was Gov. Martinez’s misguided decision to expand Medicaid that could push New Mexico toward insolvency. While touted as an “economic stimulus,” in the upcoming fiscal year, nearly half – 928,000 – of New Mexico’s 2 million people will soon receive Medicaid, a government welfare program.

Despite (or more likely because of) expansion, New Mexico’s budget remains in a deficit and our unemployment rate remains second-highest in the nation at 6.7 percent.

This year, Medicaid expansion is expected to cost New Mexico “just” $45 million. After a few years of the federal government picking up 100% of the tab, New Mexico is now on the hook for 5% of expansion for half of one year.

Next year, with the feds still picking up 95% of the tab, New Mexico’s share of Medicaid expansion jumps dramatically to about $120 million. Over the five-year period from now until 2021 just the expansion cost of Medicaid (10% of which will soon be paid by New Mexico) will cost State taxpayers $778 million. That is money that we simply don’t have – and are not likely to have, barring a miraculous economic turnaround.

Tellingly, in Gov. Martinez’ latest budget proposal, Medicaid was among a tiny handful of spending areas that a significant increase. Schools, roads, courts, prisons, economic development, and just about every other priority our state might have will soon face the money-devouring maw known as Medicaid. Without decisive the welfare program will quickly devour the budget.

Lujan-Grisham apparently doesn’t care if Medicaid destroys New Mexico so long as ever-larger numbers of its citizens receive this government program. But President Trump is not as enthusiastic about Obamacare, or its expansion of Medicaid. He and Congress will likely address problems with the entire law, possibly in the form of Medicaid “block grants.”

A block grant means that a pool of money would be made available to the states. The revenue would be limited and, depending on details, states would be given some degree of freedom to make those dollars stretch to cover the neediest people in the state.

While specifics are being worked out, a block-grant solution would completely change the state’s incentives under Medicaid. As a recent “Progress Report” from the Legislative Finance Committee recommended, New Mexico should “efficiently and effectively use state funds to maximize the ability to draw down the federal Medicaid match, especially in light of uncertain state revenues.”

In other words, Medicaid encourages impoverished New Mexico to fleece taxpayers in the other 49 states. But grab-the-cash could be coming to an end.

With her eye on the governor’s mansion in 2018, Lujan-Grisham would be wise to bone up on ways to make limited Medicaid dollars work for New Mexico’s truly poor.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility