Walker effect: Nearly a third of Alaskans on Medicaid - Must Read Alaska
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Friday, March 5, 2021
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Walker effect: Nearly a third of Alaskans on Medicaid

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By DAN FAGAN

How bad was former Gov. Bill Walker for the state of Alaska? Let me count the ways. He was certainly one of the most consequential governors in Alaska’s short history. 

His expansion of Medicaid under Obamacare has had a devastating impact on the state’s budget. In the year 2000, Alaska spent $486 million on Medicaid. That accounted for less than 10% of the state’s budget.

But since Walker’s expansion of the entitlement program, Medicaid costs to the state have exploded in growth. Since 2000, Medicaid spending has skyrocketed 379%.

In 2018, more than one-fifth of the state’s budget went toward Medicaid expenses. Medicaid spending in Alaska is currently growing 25 times as fast as state revenues.  

Since Walker expanded Medicaid to include able-bodied childless adults, it’s created close to an additional 100,000 government dependents. Before expansion Medicaid was limited to Alaskans who are elderly, disabled or families with low-income children and pregnant women. As of Aug. 31, 232,735 Alaskans are now on Medicaid.  That’s up from 125,616 before Walker expanded the entitlement program.  

Walker told us expanding Medicaid would lower health care costs for all Alaskans. It didn’t. Since 2014, the average health care costs for Alaskans is $11,000 higher than any other state.

Walker also left a mark on Alaska when he committed political suicide after opening the door to raiding the Permanent Fund. Legislation Walker signed allowed for the propping up of Alaska’s Jabba-the-Hut-like government. 

Before Walker, politicians would not dare talk of using money set aside for the yearly dividend and using it for government. Walker not only talked of it, he made it happen.  

Walker was a wholly owned subsidiary and creation of Big Labor and other special interests. We know how much Big Labor loves big government. Former AFL-CIO union boss Vince Beltrami along with former newspaper publisher Alice Rogoff created the Walker/Byron Mallott Unity Ticket. The only thing the Walker/Mallott team unified around was special interests depending on government largess to survive.  

Walker did them proud by opening the spigots of the multi-billion-dollar Permanent Fund, causing a tidal wave of cash to flow into state government. No need for cutting with that kind of cash pouring in. 

Lobbyists, union bosses, non-profit cabal types, deep-staters, and benefactors of corporate crony capitalism were thrilled. They finally had access to the massive Permanent Fund they’d been lusting after for years. 

With Walker raiding the Earnings Reserve Account came the shrinking of the yearly dividend check.  Walker signed legislation causing the Permanent Fund to operate more like an endowment. That meant each year the Legislature would determine how much was spent on dividend checks. Previously, the amount was determined by a statue (still in law) based on a five-year average of the fund’s earnings. 

This allowed Walker to veto the money the Legislature appropriated. His first year in office, Walker vetoed approximately half of the money allocated for the dividend check, costing each eligible Alaskan $1,100. Since the policy change, an Alaska family of four is out more than $30,000 in dividend check money and counting. 

Who knew electing the Unity Ticket would be so expensive? 

The Walker plan to allow the Legislature, not a statutorily mandated formula, determine the size of the dividend check each year also favored special interests by tying the hands of future governors who wanted to see a full dividend payout. 

Walker’s successor, Republican Mike Dunleavy, campaigned on issuing a full dividend and returning the money vetoed from previous checks. But the Legislature wouldn’t appropriate the money needed for Dunleavy to keep his campaign promise. 

As a result, many of those incumbent legislators were ousted and like Walker, today, couldn’t win a seat on their local community councils. 

Another reason Walker is so disliked among Alaskans is his signing of so-called criminal justice reform legislation in 2016. The new law was nothing more than letting the bad guys out of jail early scheme to save money. It also weakened penalties so significantly that criminals got nothing more than a light slap on the wrist for stealing. 

Next to ACES, Senate Bill 91 was the most devastating piece of legislation politicians ever passed. Many of the legislators who voted for the law lost reelection. 

Walker was able to get through much of what he wanted as governor. Fortunately, for all of us, he was unable to tie Alaska closely to the Communist government of China and his long-held dream of building a gas pipeline. 

Walker’s plan all along was to rip the leases from oil companies with rights to Alaska’s gas and cozy up to China to get his pet project pipeline built. Walker often spoke of the Norway model where the government, not the private sector played a bigger role in developing resources. That’s the reason Walker ran in the first place.

Fortunately for the state, he was unable to accomplish his most important goal. 

Dan Fagan hosts the number one rated morning drive radio show in Alaska weekdays on Newsradio 650 KENI. He splits his time between Anchorage and New Orleans.  

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  • Maybe we should be thanking, posthumously, Byron Mallott. Although I believe the unity ticket wouldn’t have been elected again, his antics secured and saved us from further damage.

  • God help you if you don’t qualify for Medicaid and free tribal health care in Alaska. If you’re a working slug like me you can bet that you’ll end up paying your share and more. I’ve had some medical care this year and thankfully have been able to coverage the hidden costs out of pocket but the pocket is now empty. I still don’t qualify for Medicaid and I still would be too proud to accept it.

    • YES, the small percentage of Alaskans who don’t have government paying their health care are really caught in the bight! First, since government pays for most there is no reason for most consumers to care how much it costs. So for the few that do care the price is very high. Second, so far as your ability to buy insurance it’s going to be a high price ($40,000 per year for a family of 3 I know, with no real health issues) and a very high deductible = so high that you really don’t have insurance! You need to look into buying your way into a tribe; after all, those doctors and dentists make $500,000 a year and more, and the government contractors that employ them want even more clients. So you may find you are 1/32 Native American. Another choice is to find a way to get into the cash economy so you can qualify for Medicaid based on your official income. I know the choices are poor and you did not cause this problem; your government did!

    • You and too many are in the same boat. If you work hard for a living In private enterprise you likely are going without the astronomical coverage yet you pay for those that most likely are not working. If you somehow manage to budget for coverage the cost is as high or higher than a mortgage. The cost for private health insurance skyrocketed with the advent of Obamacare. My husband and I are still managing to pay for insurance but it has doubled in price since the “affordable” care act was enacted. Unconscionable.

  • There’s always free cheese in the mouse trap.

    • Exactly.

  • Absent significant changes to the Medicaid program, there will come a time in about 10 years when Medicaid consumes the entire State budget that is funded by GF income. And for those on the Left, that means that no money will be available to fund education. As in zero. Time to make some choices.

  • You make some great points here. Governor Dunleavy also ran on no state income tax. I know that arithmetically having a balanced budget without an income tax, and returning to the PFD formula (at least until or unless Alaska voters approve a change) is pretty easy. The politics have been difficult however, to say the least. But as you indicate, Medicaid spending increases must be reversed if the budget is going to balance at a common sense and practical level. I have seen estimates that as much as 90 to 95 percent of all health care costs in Alaska are paid by government; 80,000 government employees plus military personnel and dependents, BIA, Medicaid, Medicare, public employment retirees, etc. That is why health care is so expensive here, and clearly, government is too big compared with aggregate output; 450,000 barrels per day, a salmon industry subsidized by oil revenue, a handful of medium-sized hard rock mines, and a tourism industry selling tee-shirts made in China. We produce too little and consume too much, and Medicaid is a material part of the unsupportable consumption, along with an anachronistic and mediocre university system, state-owned RR and ferry enterprises designed by labor unions, and an education system that turns in terrible results at untenable and unsustainable financial and social cost. On the plus side we expect a common sense incoming legislature. But the challenges include that after the coming session Governor Dunleavy becomes a lame duck, and we have to face the fact that next month might result in a White House that is hostile to Alaska. The state operating budget due on 12/15 will cast the die for a period extending into the second half of the 21st century. The coming 90 days could not be more important to Alaskans.

  • The welfare programs that supports a big part of the population that live where there exists no economy are also a large part of the load on the state income. Walker is like Obama was to the US, the worst thing to happen to Alaska, ever.

    • Completely agree.

  • The federal laws/rules that dictate how Medicaid is run set the program up to expand without limit for those who qualify (a pool of people getting larger & larger) at the expense of those who do not qualify since its basically 100% free for those who enroll. No deductible, no copay & no monthy premium. Insurance plans like that in private industry and even government are rare & where they exisit, considered cadillac plans.

    Medicaid, if we are going to have to live with it, needs to carry a cost to its users. Like Medicare. Maybe some combination of a monthly fee, copays etc. Federal rules prohibit that but our federal reps need to work to change that. The subscribers to Medicaid, where ever possible, need to help pay for it, instead of other Alaskans who can barely pay for their own insurance. This might help give some relief to our state budget.

    But I suspect our federal reps won’t want to be seen advocating a monthly fee for medicaid or copays/deductibles when possible because they would be villified by the left.

  • And nobody mentions the $billion for Power Cost Equalization? We are supposed to be self sufficient and tough and resourceful. If you want to live in the Bush and can’t afford it, figure it out. I want to live out there and I can’t afford it, and I don’t expect other people to subsidize my decisions, so I don’t.

    This budget isn’t for politicians to solve, this is for ALL of us to solve. If you’re leeching off Medicaid and have no kids and are able bodied, SHAME ON YOU. Fix your life so we don’t have to carry you. If you’re on some program you don’t need to survive, GET OFF IT. Carry your own weight.

  • Once upon a time, the people of Alaska were known for being self reliant and independent.

  • Hi Dan! I waited a few days to comment because I didn’t want to get in a full scale debate. I have no numbers to back up what I say, just my own observations and the fact that I’ve dated a couple nurses. Fairbanks Memorial used to be a hole where people went to die. The only place worse than FMH that I’d seen was Navapache Medical in the poorest county in America. I couldn’t understand why FMH was such a hole, so I asked. I was told that because of legal and moral considerations, the hospital had to treat everyone who showed up at the ER. People who couldn’t afford insurance were using the ER as their primary care provider and it was destroying hospitals financially. Medicaid expansion seems to have changed all that. Yeah, I know, the government (taxpayers) are paying for it, but it won’t matter how good your insurance is, in an emergency you don’t have a choice where you end up at…do you really want it to be a third world hospital like FMH used to be?

  • You can thank people such as former Rep. Seaton and current Sen. Stevens who were all-in for Medicaid expansion despite knowing the cost to our state. They knew that supporting this could bring them votes from Democrats, and that was more important to them than keeping Alaska fiscally strong. Stinking RINOS.

  • We need to destroy the liberal, socialist scumbags in this coming election or our state will join the country in creating an environment that is devoid of individual freedoms and rights granted by our Constitution. The conservative people of Alaska need to show up in mass at the polls to make this happen.

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