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Help on the horizon

SoVaNow.com / February 28, 2013
It’s easy in these rocky times to get carried away with a hell-in-a-handbasket outlook on the local economy. South Boston can be thankful it is not South Hill — three major industry closings in that fair town since the start of 2013, costing some 400 jobs — but it’s not like our community is setting the world on fire, either.

Rebuilding the region’s economy is a hard slog that requires patience and fortitude. (And vision. Which is harder to come by. Just ask the Virginia Tobacco Commission.) Truth be told, Southside Virginia’s hopes for recovery after all we’ve been through in the past four or five years hinge first and foremost on an upward trajectory for the country as a whole. This can be a dismaying thought, especially as we watch the idiotic federal budget sequester unfold in Washington.

The sequester fight is fundamentally about whether America should follow a path of budgetary austerity — spending cuts, tax hikes — to ensure its future prosperity. Alas, everywhere it’s been tried, austerity has been a disaster. This is especially true at the moment in Europe, which is under the sway of austerity’s champions even as it wallows in recession. But you don’t have look across the pond to see what happens when government becomes overly stingy during sluggish times. For generations, Southside Virginia has failed to adequately invest in infrastructure, education, and all the other things that foster growth, and the results have been nothing if not predictable.

Fortunately, there’s a big deal looming on the horizon for Southside that promises to inject some cash into the economy and, more importantly, provide day-to-day relief for households struggling to pay their medical bills. Not everyone is going to benefit directly from the change, but the secondary impacts should be immediate and widespread. Imagine what it might mean for local businesses that rise and fall with consumer confidence if thousands of paycheck-to-paycheck households could receive help with health care costs that, at best, are too high, and at worst, can quickly become ruinous.

Virginia is moving, push-me-pull-me style, towards expansion of its Medicaid program, in step with most of the rest of the country. And the change needs to happen … ASAP.

Medicaid, you ask? What does it have to do with economic recovery in Southside Virginia? The answer lies with the region’s demographic makeup. This may come as a surprise — or maybe not — but fully one-fifth of Halifax County’s population lives at or below the poverty line (6,833 persons in 2010, according to census data). There are hundreds of local households where members hold down work but do not make enough to enjoy any semblance of financial stability. With money so tight, the first thing many people do is scrimp on health care. And if life goes wrong, the impact can be especially devastating.

Halifax County has seen hundreds of households fall into a state of poverty or near-poverty over the past decade. You cannot wipe out a large share of the community’s manufacturing base without replacing the jobs lost and expect a different result. It would be extremely helpful, however, if stranded wage earners weren’t forced to choose between paying for food for their children and health care for themselves. It would also be enormously beneficial for the community’s health care providers — among our last reliable engines of a middle-class livelihood — if patients could pay their bills. Wanna guess how much money the two hospitals in Halifax and Mecklenburg counties, Halifax Regional and Community Memorial Healthcenter in South Hill, forfeited in 2011 from writing off bad debt? Nearly $23 million. (Source: Virginia Health Information, http://www.vhi.org)

The Medicaid expansion is a key component of the Affordable Care Act, a.k.a. Obamacare, which remains controversial even as it has survived every challenge thrown its way. The expansion is scheduled to kick in at the beginning of 2014; at this time, individuals and families making up to 138 percent of the federal poverty line will become eligible for Medicaid, which pays the health care bills for low-income children, the disabled, and the poor. (Under Virginia’s truly ridiculous Medicaid income limits, make that the very, very poor; a family of four making more than $10,000 does not qualify for Medicaid, although the kids may be eligible for coverage under the related FAMIS program). With the Medicaid expansion, the family-of-four income cutoff rises to $31,000 annually. Starting next year, an estimated 400,000 Virginians will become eligible for coverage under the change. And quite a few of these folks live here in Halifax County, where the median household income is only $34,574.

According to the census, in 2010 there were nearly 3,200 county residents of all ages living at or below the poverty line who did not have health insurance. Does anyone seriously believe that bringing these folks into the Medicaid system will have zero impact on their willingness, and ability, to spend dollars elsewhere in the community?

On the flip side, the Medicaid expansion is projected to create 30,000 health care jobs in Virginia. No doubt some of these new positions will be added here in Halifax County. How can more paychecks not be beneficial for the local economy? The best part, purely from the standpoint of who pays, is that it’s the federal government that pays — 100 percent of Medicaid expansion costs for the first three years, 90 percent after that. The usual suspects will protest that Washington can’t do that, becausethe country’s broke. Well, there’s a problem with this reasoning (aside from being essentially false): if Virginia passes up the money, it’ll just go somewhere else. At least we have the benefit of living near North Carolina.

Given how consistently right-wingers have been wrong on the economy, and so loudly to boot, one should be wary of their claims that the Medicaid expansion will saddle Virginia with unbearable costs. (Ask our local hospitals about the tens of millions of dollars they expend each year providing charity and uncompensated care. Talk about unbearable). Truth be told, there’s so much wasted money sloshing around the health care system that the objective of the Affordable Care Act — widening coverage to all — should be attainable even without a major boost in spending. Whether the law will succeed in making health care both more efficient and more accessible remains to be seen, but the problem of overly expensive health care isn’t limited to Medicaid, which has been reasonably successful at keeping down costs.

The politicians can’t seem to talk a straight line on any of this, but they are coming around on Medicaid, albeit kicking and screaming. To win passage of his transportation package — a real dog’s breakfast of taxes and fees, that one — Gov. McDonnell had to promise Democrats in the General Assembly that Virginia would take part in the Medicaid expansion. (State-by-state participation is optional. It’s a long and complicated story for which you can thank the United States Supreme Court). McDonnell’s pledge convinced Democrats to vote for a transportation bill that no one really likes and may not work as advertised, although surely it meets the something-is-better-than-nothing standard. But getting back to Medicaid: despite the governor’s assurances, Virginia may yet spurn the feds’ offer to pay for the program’s expansion. The ultimate decision rests with a legislative panel which may not comes through on Medicaid Which would be a terrible blown opportunity for our area — leaving thousands of Southside Virginia citizens lacking health insurance, amid a jobs market that is only slowly recovering (if that) and can’t be counted on to fill the void.

Call your local legislators to ask them to press for the Medicaid expansion, and don’t fall for any nonsense about the need to first “reform” the program before Virginia takes part in its expansion. Medicaid spending in the Commonwealth ranks near the bottom in the U.S., despite the fact Virginia is far wealthier than many states. This is an opportunity for our local representatives in Richmond to do something immediately and directly to help their constituents, with little or no impact on the state budget. If the politicians can’t muster this much regard for the people they’re supposed to serve, they need to find a new line of work.









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