Rhode Island Department of Administration Director Richard Licht nailed it at the New England Public Policy Center at the Federal Reserve Bank of Boston presentation recently, when he pointed out that the cost of government in Rhode Island is so far above the calculated “need” that if we just lowered it to that level, our deficit would be gone. (March 3, 2011, The Rhode Island Foundation) At that point, I considered the day a success.
Mr. Licht’s statement came in reaction to the presentation, “How does New Hampshire do it,” which diagrams the Granite State’s ability to operate at a cost 20 percent below the New England average. New Hampshire also spends well below the “Expenditure Need,” a metric calculated by a state’s poverty rate, prevailing wages and other demographics, weighed against the New England average. No surprise, Rhode Island spends well above that calculated “need.”
Licht quickly, with a back of the napkin calculation, said that the amount we spend above that need threshold is about the same amount of our current deficit – approximately $295 million. That’s right! Rhode Island spends more than we “need” to. But how do we spend less?
While the New England Public Policy Center presentation did not make policy recommendations, it did identify cost-saving opportunities labeled “factors within government’s direct, near term control.” These are eligibility factors (which control the number of people served), breadth of services (which affect quality and comprehensiveness of services), and system efficiencies.
Following my query on evaluating the factors under New Hampshire’s control to determine where they created savings, Yolanda Kodrzycki, director of the NEPPC, said that Medicaid is an interesting place to look, because New Hampshire appears to provide equivalent services but at lower costs.
Like most states, but perhaps more so here, the middle class and wealthy are receiving taxpayer-funded health care through our Medicaid program. This is one place Rhode Island exceeds its need.
In the Ocean State Policy Research Institute study, “Doing Long Term Care RIght,” we reported that more than 80 percent of seniors own their homes and more than 70 percent of these own their homes free and clear. However, Department of Health and Human Service staff reported that 1,140 Medicaid recipients or only about 12.7 percent of the caseload still own homes.
Rhode Island‘s Medicaid eligibility policy chief told us that in his decades of experience, he has only seen eligibility denied to two applicants based on excess income.
There are so many legal ways of “hiding” assets that it’s become a cottage industry. But that’s what people do – they look out for their own self-interests even at the cost of those around them. And yes, even the rich do it.
We all want to help our fellow man, or woman, but I personally don’t think it’s in the American spirit to provide those services to the middle class and wealthy simply because they chose not to save for their own care, or have crafty lawyers that can hide assets. We can take that path if you want to, but as we see with the budget cuts already on the table, short of reducing the number of people served, cutting services is our only other option.
We must separate who we want to help from who we “need” to help. •
Bill Felkner is the founder and director of policy and organizing for the Ocean State Policy Research Institute. The Medicaid report, “Doing Long Term Care Right,” is available at www.oceanstatepolicy.org.
AND why not? (Should the elderly “hide” their wealth) When Obamas Aunt, illegal can gain acess to welfare, Medicaide, and public housing, why not? When drug addits and those who abuse alcohol are encouraged to apply for SS “Disability”, and use that money and Medicaid to fund their drug abuse and consumption of alcohol, WHY not? When those who gamle and waste every penny they make in their lifetimes and then expect to have government housing susidized by me, the taxpayer? WHY NOT??? Indeed why shouldn’t most people lie to gain acess to their hard earned tax dollar when they will only be taxed more to serve those who should NOT be served…WHY NOT??? All you need is a good lawyer, and divest yourself of what you have saved over the years in order to qualify for the same care the drunk, the drug addict and the spendthrift now gain with no questions asked!!! We no longer are a nation that encourages independence, we encourage dependence, and have a Race to the Bottom! A sad commentary on our current welfare state.
Mr. Licht, thank you! Let’s push ahead and do what is right for the remaining tax payers in our beautiful state. Dorothy, right on! Over our lifetimes my wife and I have worked hard paid our taxes and saved our money with hopes of enjoying retirement together and remaining independent here in Rhode Island. We too have seen to many giveaways in this state to people who “qualified” for assistance and yes even some that live and still do in high end neighborhoods. Now that retirement is just ahead I shudder to think that our state leaders are thinking about raising more money through more taxes levied on us instead of cutting the states budget first. Me my wife and our friends love Rhode Island and never thought we’d be considering living somewhere else. Pushing the tax payers out of Rhode Island is not the way to solve our fiscal problem. Richard Licht you have my support let’s start cutting back!
Robert and Dorothy, It’s disheartening to listen to local-yocals whine like the dickens about the state of the economy that the educationally challenged local populous created. RI stinks like it does because the local, white population is one of the most uneducated and unskilled in the United States. Don’t kid youself. As is typical of a local, you blame everyone but yourself. Yeah, welfare made this state the economic crap whole it is my tush. I was shocked to hear so many locals mock higher education. It’s quite the norm here. Things will never get better here for several of the generations currently living here. I sincerely mean that on a personal level and that may include you. (If I offend, I apologize.) There are many great things happening in RI, but almost no locals qualify to even walk through the door. Out of my last 5 hires, only one was a native RI and she only answers the phone and takes messages 3 hours a day. I’m sorry if I sound mean, but sometimes the truth is blunt. By the way, New Hampshire is so cheap at the state level because they bend you over and rape you big time at the local level. Check out what real estate taxes are like there. You’ll crap your pants.
Oh, and by the way, anyone like Bill Felkner who complains about providing healthcare to any one for any reason by society (as it should be by and to all of us) is nothing more than a piece of s&^t. Period. End of discussion.