Medicaid Expansion Covers Millions At 'Modest' Cost To States: Report

Discussion in 'Politics' started by Free Thinker, Nov 26, 2012.

  1. Expanding Medicaid health benefits to everyone eligible under President Barack Obama's health care reform law would increase state spending on the program by just 3 percent while extending health coverage to more than 20 million people, according to a study released Monday by the Henry J. Kaiser Family Foundation and the Urban Institute.

    The health care law seeks to enroll into the Medicaid program anyone who earns up to 133 percent of the federal poverty level, which is $14,856 this year. But when the Supreme Court upheld the law in June, its decision allowed states to opt out of the Medicaid expansion. So far, Republican governors in eight states have declared they won't participate, denying health care coverage to millions of their poorest residents.

    Republican governors who are stalwart opponents of Obamacare, including Rick Perry of Texas and Bobby Jindal of Louisiana, cite the cost of expanding Medicaid as a primary reason for refusing to go along with the Affordable Care Act, also known as the ACA. But the states' share of the new costs of covering more people on Medicaid is relatively small. Combined with greater private health insurance coverage, Medicaid expansion would result in a large reduction in the number of uninsured people, and fewer unpaid medical bills that raise costs for taxpayers.

    "By implementing the Medicaid expansion with other provisions of the ACA, states could significantly reduce the number of uninsured," the Kaiser Family Foundation and Urban Institute study states. "Overall state costs of implementing the Medicaid expansion would be modest compared to increases in federal funds, and many states are likely to see small net budget gains."

    The total cost of the Medicaid expansion would be $1.03 trillion between 2013 and 2022, according to the study. States would pay $76 billion of that, which amounts to a 2.9 percent increase compared to what states would have spent on Medicaid if the health care reform law hadn't been enacted. Under the health care reform law, the federal government will pay the full cost of covering newly eligible people on Medicaid from 2014 to 2016, then will scale back funding to 90 percent in 2022 and later years.

    In addition to receiving a large federal subsidy to enroll these uninsured residents, states that expand Medicaid would be able to reduce spending on taxpayer-funded programs to help hospitals and other health care providers cover the cost of so-called uncompensated care, or unpaid medical bills. If Medicaid expanded across the country, states would save $18 billion between 2013 to 2022 , according to the study.