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Sen. Tom Davis would like a word about Medicaid expansion in South Carolina

The decision whether to expand Medicaid access in the state is likely to hinge on how well expansion would benefit the market.
Scott Morgan did not take this pic
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The decision whether to expand Medicaid access in the state is likely to hinge on how well expansion would benefit the market.

It’s hard to imagine in 2024, but in 2010, South Carolina was out in front of the Affordable Care Act.

It was U.S. Rep. John Spratt (D-5th) who read the bill – dubbed Obamacare – into the record of the U.S. House of Representatives that year.

And it was that introduction – and, crucially, Spratt’s support of the bill’s provision to allow states to expand the number of residents who could tap into Medicaid benefits – that cost him his job in the 2010 midterms.

Almost 15 years on, South Carolina is one of the last 10 states – and the only Carolina – to have not yet adopted Medicaid expansion, now that North Carolina made almost 600,000 residents eligible for expanded Medicaid coverage as of Dec. 1.

No South Carolina governor has ever supported Medicaid expansion in this state. Gov. Henry McMaster still doesn’t, having called expansion “a bad deal” for South Carolina.

But what about at least having an official conversation about it?

State Sen. Tom Davis (R-Beaufort) is banking on enough support to get that conversation going in the South Carolina State Legislature. At the beginning of the 2024 session, Davis introduced Senate Bill 855, to “establish a healthcare market reform study committee.”

Translation: the State Senate will officially consider officially considering expanding Medicaid in South Carolina. Davis’ bill does not itself look to expand Medicaid, but rather to form a formal body at the Statehouse that will weigh whether it’s time to join 40 other states and the District of Columbia in broadening the program’s reach in-state.

If, by the way, you’re remembering Davis as an opponent of Obamacare, you’re not imagining things. Nine years ago, when defending his bill to keep the federal government from “commandeering” South Carolina’s governance, Davis told his Statehouse colleagues: “It is clearly my purpose to deprive state assets from being utilized to hasten and speed up the implementation of the Affordable Care Act.”

But during that same speech – directly leading into that quote, in fact – Davis said this:

“I’m not going to talk about whether [the ACA] is a good idea or a bad idea. If you think the exchanges are working, if you think that it’s actually increasing access to healthcare in a way that’s sustainable, in a way that delivers quality healthcare, by all means, you ought to oppose this anti-commandeering amendment.”

While Davis was talking more about the federal Healthcare Marketplace than about Medicaid expansion particularly, his desire for deeper conversation about what it all means for South Carolina is right where he left it in 2014.

In a post on X, on Jan. 31, Davis was quoted by Politico: “We must move beyond a bumper-sticker condemnation of Medicaid expansion to a constructive analysis. We may end up making a decision not to expand, but we owe the people of South Carolina a transparent and open debate.”

To be clear, Davis is, officially, neither for nor against expanding Medicaid access in this state. He simply wants to have the conversation. Officially.

Davis says that a lot has changed about the Medicaid expansion conversation since it first began more than a decade ago.

“As time has gone by,” Davis says, “the CRS [Congressional Research Service] has given states more options to tailor [their Medicaid expansions]. There are more market-friendly options; and Republican states that have [expanded] did it with more flexibility.”

Davis said that as South Carolina looks to improve healthcare access, it’s simply not wise to leave Medicaid expansion out of consideration.

“We can’t have an honest discussion without thinking of everything,” he says. “Without bringing everything to the table.”

 

A lesson from North Carolina?

Changing early objections into support for Medicaid expansion has become somewhat vogue among some lawmakers in conservative state legislatures. In a 2023 op-ed in the (Raleigh) Carolina Journal, Republican Sen. Phil Berger, president pro tempore of the North Carolina State Senate, wrote: “For more than 10 years I was one of the staunchest opponents to expanding Medicaid in North Carolina.”

Berger goes on to explain that a Republican-led rethink of the healthcare system in his state and new ways of managing it had set the stage for expanding Medicaid “on our own terms,” which he argued would “we increase access to healthcare in a thoughtful, conservative way. We pass a plan that is good for North Carolina, and we take advantage of holding out for the past decade and secure a significant stimulus that avoids the financial hit the state would have taken years ago.”

That is something Davis also talks about, saying that South Carolina is now is a privileged position to look at how other states fared with their Medicaid expansions, to see what has worked well and what hasn’t.

And, like in North Carolina, South Carolinians are increasingly open to expansion.

A 2023 poll commissioned by the American Cancer Society found that 82 percent of North Carolinians, across all political and demographic measures, wanted the state’s General Assembly to adopt Medicaid expansion.

The Republican-controlled General Assembly did vote to adopt expansion, and Democratic Gov. Roy Cooper signed the bill into law on Dec. 1.

South Carolinians, according to an AARP study from 2021 – the year Gov. McMaster denied expanding Medicaid here – found almost identical support among those age 50 and older; and survey results released Friday by the Kaiser Family Foundation show that 65 percent of respondents of the 10 non-expansion states want to expand Medicaid access.
 

The business case

On Jan. 10, Gene Hogan, research director of the Senate Medical Affairs Committee, said that the advisory committee being considered to weigh in on Medicaid expansion would include “relevant state agencies that have involvement with this issue,” as well as healthcare and consumer advocates.

That includes business leaders.

Frank Knapp, president and CEO of the South Carolina Small Business Chamber of Commerce, says the chamber, and much of the small business community in South Carolina, has been in favor of Medicaid expansion “from the moment it started.”

From a purely business standpoint, Knapp says, small businesses simply can’t afford to pay for employees’ benefits. According to the U.S. Census Bureau’s American Community Survey, 11 percent of South Carolinians younger than 65 had no health insurance as of July, 2023.

Those numbers count South Carolinians overall, not just those of working age or who are employed.

Numbers from the State Health Access Data Assistance Center (SHADAC) at the University of Minnesota show that in 2021, 828,000 of 1.13 million benefits-eligible employees in South Carolina were enrolled in a plan, with just over a half-million (503,000) enrolled in high-deductible plans.

With rare exception, the ACA mandates that employers with 50 or more full-time workers offer coverage to at least 95 percent of those workers.

According to data from the Kaiser Family Foundation, 98.4 percent of South Carolina companies that have 50 or more employees do offer coverage plans to employees. That compares to 21 percent of companies in the state with 49 or fewer employees that offer coverage.

If not for Alaska, South Carolina would have the lowest percentage of small employers offering benefits to U.S. workers.

And percentages have gone down in recent years.

The SHADAC data show that 41 percent of private sector employers in South Carolina in 2021 offered healthcare benefits to employees. That was down 11 percentage points from 2020, which was already down 6.4 percentage points from 2019 to 2021.

It is, however, important to note that approximately 80 percent of South Carolina’s private-sector employees worked at an establishment that offered coverage, according to Robert Hest, a senior research fellow at SHADAC.

However, estimates for South Carolina’s 2022 numbers, published by the Agency for Healthcare Research and Quality (part of the U.S. Department of Health and Human Services) show that 45.5 percent of private sector employers in South Carolina offered coverage, while 85.2 percent of employees worked at an establishment that offered coverage.

While Frank Knapp is aware that Gov. McMaster maintains his opposition to expanding Medicaid access under current guidelines, he’s also optimistic that the political climate has changed.

“When the Affordable Care Act came out, Republican states resisted it,” Knapp says, blaming that reaction on politics to spite the Democratic president who’d pushed the bill, Barack Obama. “But that was a long time ago. That [thinking] doesn’t resonate.”

In 2021, Gov. McMaster resisted Medicaid expansion in connection with federal Covid fund incentives to bring more states into Medicaid expansion. At the time, he said that “the way to good health is good employment, good education.”

Knapp says that good employee health is at its healthiest when employees don’t have the stress and financial burden of not having medical coverage, which only serves to compel them to work while sick and not see the doctor.

“This is a hardship for people who fall into the coverage gap,” he says. “We would have a healthier workforce if we expanded Medicaid.”

Maya Pack, executive director of the South Carolina Institute of Medicine and Public Health (SCIMPH), says that business itself will do better in the state if lawmakers decide to expand Medicaid access.

“As more and more states participate in the expansion of Medicaid as allowed under the Affordable Care Act, they're seeing really positive health outcomes and improvements in health status,” Pack says. “But they're also seeing some positive economic impact to their state in terms of a strong workforce and job creation, because when this level of investment comes and services expand, providers have to hire people to provide those health care services.”

Cover SC, a nonpartisan coalition that champions closing the healthcare coverage gap in the state, estimates that Medicaid expansion in South Carolina would generate 31,000 new jobs, half of which would be non-healthcare jobs; contribute $7.6 billion in personal income growth – and a corresponding $68 million in new tax revenue – over three years; and trigger $192 million in savings annually on state-funded programs.

These estimates are based on other states' experiences, according to Cover SC’s website.

For Sen. Davis, the market benefits of expanding Medicaid access in the state are what he thinks could turn the tide of resistance.

“I believe in markets,” Davis says. But he also knows that there is a large gap and a pile of bad health numbers in South Carolina.

Davis says that while the political left gets nervous about market solutions to public issues, the political right gets suspicious any time there is talk of a government program benefitting a social issue. This is why he wants to get the exploratory committee going, with input from business, healthcare, and policy leaders across the spectrum, he says.

“I want to talk to [left and right] and find ways to improve outcomes,” he says. And if expanding Medicaid access proves to be good business that would lead to better health outcomes, then he will support expansion.

How would Medicaid expansion affect South Carolina?

Medical debt in South Carolina is worse than in any other state, except for West Virginia. Twenty-two percent of South Carolinians were burdened by medical debt as of 2022, according to data from the Urban Institute.

According to a report published earlier this month by the policy reporting outlet Stateline, access to Medicaid-subsidized healthcare would greatly reduce medical debt burden in the 10 expansion holdouts.

The Kaiser Family Foundation estimates 188,000 uninsured, nonelderly adults in South Carolina would immediately become eligible for coverage if the state expanded Medicaid.

An article published in December in the National Journal of Medicine states that South Carolina’s healthcare system “faces significant challenges, with a ranking in the bottom 50 percent of all states, a statistic that warrants serious attention.”

Accessibility, the paper argues, is a paramount concern.

“The state currently has a higher percentage of its population that is medically uninsured compared to the national average in the United States (18 percent vs. 14 percent, respectively),” it states. “Consequently, a lower proportion of South Carolinians enjoy access to healthcare services when compared to residents of other states.”

For healthcare advocates, the medical benefits expansion would theoretically bring top all concerns.

Cover SC estimates that expanding Medicaid access in South Carolina would lead to a 47 percent decrease in family medical debt; a 12 percent decrease in mortality by year four; a 2 percent decrease in mortality in lung, breast, and colorectal cancer from screening and earlier diagnoses; as well as an 18 percent increase in access to diabetes care, 39 percent more cholesterol-lowering prescriptions written, and 31 percent more hypertension-controlling medications prescribed.

These kinds of estimates are backed up by research published in 2021 (and expected to be updated this year) by SCIMPH, which studied health outcomes in several states that had originally resisted, but ultimately enacted Medicaid expansion.

Sen. Davis says he expects the issue of creating a state taskforce aimed at weighing Medicaid expansion in South Carolina to be part of the Senate Medical Affairs Committee’s agenda in the coming weeks.

Correction: The description of Cover SC has been amended to reflect that it is a coalition.

Corrected: February 23, 2024 at 11:02 PM EST
Frank Knapp’s title has been corrected to president and CEO of the South Carolina Small Business Chamber of Commerce.
Scott Morgan is the Upstate multimedia reporter for South Carolina Public Radio, based in Rock Hill. He cut his teeth as a newspaper reporter and editor in New Jersey before finding a home in public radio in Texas. Scott joined South Carolina Public Radio in March of 2019. His work has appeared in numerous national and regional publications as well as on NPR and MSNBC. He's won numerous state, regional, and national awards for his work including a national Edward R. Murrow.