In the era of the Affordable Care Act, rising health care costs are threatening California’s state budget. The LA Times reports:
Enrollment in the state’s healthcare program for the poor, known as Medi-Cal, has exploded by 50% since President Obama’s signature law took effect. Although the federal government picks up most of the tab, state costs have also been growing, and faster than expected.Meanwhile, the annual bill for healthcare for public retirees — a benefit promised decades ago — has more than doubled in the last decade. Current and retired workers have accumulated $71.8 billion in healthcare benefits as of June last year, and the state has set aside almost nothing to cover the costs.
In other words, it’s not just individuals who are seriously strapped by rising health care costs, but states too. Obviously, the ACA isn’t to blame for the fiscal strain posed by public sector retirees, but it will leave states with even greater financial burdens when the federal government cuts back on the support it provides. These facts show how misnamed the ACA is. Meanwhile, wonks are celebrating the national slowdown in the rate of spending growth, and missing the point. On the ground level, costs are getting worse, and there’s no politically viable solution in the offing. In that respect, at least, the post-ACA reality is no different.