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What’s $2 billion among friends?

Easy come, easy go, am I right?

It's constitutional - deal with it

If Texas leaders turn down the federal health law’s Medicaid expansion, they will reject a $2 billion annual revenue stream for the state’s hospitals, according to Dan Mendelson, CEO and founder of Avalere Health, a strategic advisory company based in Washington, D.C.

Speaking at about 2 minutes, 5 seconds into the video above, which records part of a Politico Pro event held in Washington on Thursday, Mendelson says of the Affordable Care Act’s proposed adult Medicaid expansion:

“If you think about, for example, in the state of Texas, if they don’t expand, that’s close to $2 billion of revenue for Texas hospitals and at a time when they are essentially going to be paying for the ACA expansions for everybody else,” he said. “So the math here is even more dire than it was … . The math will start to overtake the politics as the governors start to really understand what the economics are here for the providers — because again, the governor gets to decide whether these providers are going to go out of business.”

Click the link above to see the video. The thing that everyone needs to remember is that saying “no” doesn’t change any of the arithmetic. That $2 billion is going to come from somewhere, and that somewhere is local taxpayers, who will be forced to deal with the expense at the county level. If there’s ever going to be a break in this impasse, it will have to come from counties and hospital districts.

Former state Medicaid official Anne Dunkelberg, associate director of the center-left think tank the Center for Public Policy Priorities in Austin, says that if Texas doesn’t expand Medicaid, it will forego an additional $7 billion a year of federal Medicaid matching money in 2014, 2015, 2016 and 2017.

Mendelson, who was a health policy bigwig at the Office of Management and Budget in the final years of former President Bill Clinton’s administration, said Florida Gov. Rick Scott has suddenly changed his tune about the federal law and decided “maybe he needs to work with it.” Mendelson didn’t make a prediction about Perry, who it can be argued leads a more conservative state than Scott does — and apparently wants to run for president again.

Speaking of governors in general, though, he added, “It just becomes much more difficult to hold high principle when from an economic perspective, you’ve got severe adversity that you are causing to happen to providers in your state.”

Never underestimate Rick Perry’s ability to deny reality in pursuit of a political goal. Remember also, just because Texas doesn’t get the benefit of federal funds for Medicaid expansion doesn’t mean that Texas will pay any less into the federal kitty for those funds. Our tax dollars will be subsidizing all those other states that do accept the funds for Medicaid expansion. I’m sure Andrew Cuomo and Jerry Brown and the like will be very appreciative of that. Some other Republican states are figuring this out, but as usual I expect Texas to lag behind the field. Seems to me this could be a pretty good rallying cry for Democratic turnout in 2014, if we intend to be serious about trying to win that year.

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