Guest Commentary: State Medicaid Spending is Ticking Time Bomb

March 2, 2012

Everyone knows about the $15.5 trillion national debt and most know that entitlements at the federal level make up an additional debt bomb that is about to explode.

Almost no one understands that Colorado has its own entitlement burden that is about to destroy spending for everything else in the state including education.

The big difference is that the state can’t print money to cover the growing expense and our budget has to be balanced every year.  We have two choices: 1. Reform the Medicaid program to make the entitlement sustainable or 2. Defund education, starting with colleges.

I’m not proposing that we do away with the program, that battle was lost years ago.  I’m merely exposing the math problem that exists.  We don’t have enough money and there is no prospect of raising the money.

Don’t believe me?  The Joint Budget Committee staff, the Common Sense Policy Roundtable and the University of Denver have all looked at the numbers and have concluded that we will have no money left at all for colleges within five years.

I don’t think we have that long.  I think the day of reckoning for higher education funding comes with the next recession, which will most likely hit way before 2017.  At that point Medicaid rolls will explode again, revenue will drop and the state will slash funding for K-12 as low as possible under Amendment 23 and completely defund colleges.

The good news is that this entitlement can be reformed and most likely made sustainable.  In pilot projects we have evidence of saving $1200 per person in expenditures.  If we took that success system wide, we’d save over $700 million per year, more than enough to put our finances back in order.

The reform will take leadership, though.  Democrats and Republicans who split control of Colorado government will have to work together to save funding for education and make Medicaid sustainable.  The numbers show that it is possible, but can the Democrats bring themselves to admit that years of expansion of the entitlement Medicaid has jeopardized funding for education?

At this point it looks like they’d rather take us to the brink of disaster and hope against reason that the people of Colorado will change their minds and agree to a tax increase to solve the problem that should have been avoided.

State Senator Greg Brophy represents Senate District 1, which includes Cheyenne, Crowley, Kiowa, Kit Carson, Lincoln, Morgan, Washington, and Yuma Counties.

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