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As many people know, businesses with more than 50 employees will need to offer affordable insurance to their workers or potentially pay a penalty. The fee is then used to offset some of the costs of providing those employees tax subsidies in the new health benefit exchanges. Many people do not realize, however, that businesses in states that do not expand Medicaid will face steeper penalties than companies in states that expand Medicaid.

The reason for this discrepancy is that a business only faces penalties when their employees get subsidies in the exchange. If a company does not offer affordable health insurance, but its employees qualify for Medicaid, the employer does not get penalized. Also, in states that do not expand Medicaid the subsidies will reach down to people earning 100 percent of federal poverty level. That means more people will get subsidies and more businesses will get penalized.

We’ve known all of this. Until now, however, no organization had quantified how much more in penalties employers might face. Now the tax services company Jackson Hewitt has released an analysis saying the amount of additional employer fees for North Carolina ranges between $65 million and $98 million.

This is just another reason why blocking Medicaid expansion and sending our federal funds to other states is a bad idea.

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According to his public schedule Gov. Pat McCrory will reject funds to insure 500,000 more people in our state at a closed door bill signing at 4:30pm today.

We have detailed the tremendous costs to the state of rejecting this federal money. It will mean more people delay necessary health care treatments. It will mean a population that is sicker and dies sooner. It will mean rural hospitals will continue to struggle with a mixture of federal cuts (including some in sequestration) and financial pressure from treating the uninsured. It will mean that our Community Health Centers will continue fighting to stay afloat. It will mean that many of the terrible health disparities that exist in our state will persist.

Remember, Gov. McCrory did not have to sign this legislation. He could have vetoed it. He could have let it take effect without his signature. Instead, he is lending this ill advised move his active endorsement. It is too bad that he won’t face the public as he writes them off.

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Nikki, a 12-year-old Charlotte resident, is a top student and talented musician. She also has Type 1 diabetes. Dealing with a chronic medical condition is enough to keep any parent up at night. Before health reform, anyone with a chronic condition was also at risk of getting locked out of the insurance system.

This is one family that is glad they no longer have to fret about obtaining insurance coverage. Here is their story.

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Unfortunately, legislators in North Carolina have decided to refuse federal funds to extend Medicaid coverage to 500,000 uninsured people in our state. Thankfully, during debate on the bill they largely dropped some of their wildest talking points and stuck to the line about Medicaid in North Carolina needing reforms before it expands.

That hasn’t stopped John Hood from doubling down on crowd out as the biggest reason to block expansion. It turns out, according to his telling, that single-payer forces are attempting to extend Medicaid to more parents and uninsured adults as a secret plot to put insurance companies out of business.

In response I’ll just say that actuaries who get paid to model sources of insurance coverage show, in state specific estimates, that the number of people with private health coverage will increase after 2014, even with Medicaid expansion. Increasing the number of people with private insurance is a pretty roundabout way of getting to single-payer.

Also, most insurance companies think Medicaid expansion is a good idea. That’s because they recognize it will allow the uninsured to get coverage. That means if those families eventually change to private coverage they will be coming from Medicaid instead of from the ranks of the uninsured. Insurers realize that the uninsured have many more unmet medical needs than those on Medicaid. Someone coming from Medicaid to private insurance will use fewer health services. Insurance companies, we should note, would prefer not to go out of business.

With people getting premium support payments it is more cost effective to expand coverage through Medicaid. Legislators originally claimed that increasing the number of people on Medicaid is a huge problem because it would drastically shift the payer mix at hospitals across the state. These hospitals would still see the same number of uninsured patients and a large percentage of their private patients would switch to public coverage. Hospital financial officers and actuaries all dismissed that claim so politicians have dropped it. Let’s hope others follow suit.

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It is safe to assume that John Hood, president of the John Locke Foundation, has easy access to Gov. Pat McCrory and legislative leaders in Raleigh. That means he has more insight than the rest of us into what motivates Republican lawmakers. That is why I found his column today interesting.

Hood explains to the rest of us why Republicans rejected a health benefits exchange and the Medicaid expansion. Just to be technically correct, the legislature did not reject a state exchange this session. It’s too late to set up a state exchange for 2014. Instead, they decided to surrender state functions we are already performing to the federal government. Now back to the point of this post. Hood says the reason Gov. McCrory and the legislature do not want a state exchange is because they buy into a slightly wacky legal theory pushed by the Cato Institute that says in a federal exchange people can’t get subsidies and the employer and individual penalties don’t apply.

Let’s set aside the legal reasoning here. Most lawyers reject this idea, but with our current Supreme Court I don’t take anything for granted.

What is more intriguing about the column is Read More