Study highlights cost benefit of expanding Medicaid

ModernHealthcare.org

June 3, 2013

An independent study released today in the journal Health Affairs on the economic impact of Medicaid expansion under healthcare reform found that states' share of the cost of expanding Medicaid under reform would be lower than the cost of providing uncompensated care to their uninsured residents.

The RAND Corp. looked at the 14 states considered least likely to support or allow for the expansion of Medicaid under the Patient Protection and Affordable Care Act—Alabama, Georgia, Idaho, Iowa, Louisiana, Maine, Mississippi, North Carolina, Oklahoma, Pennsylvania, South Carolina, South Dakota, Texas and Wisconsin. These states were among the first whose governors said they would not support the expansion. According to RAND's analysis, if those 14 states do not expand Medicaid, 3.6 million more people will go uninsured, the state governments will spend an additional $1 billion on uncompensated care in 2016, and they will forfeit $8.4 billion annually in federal payments.

“States that do not expand Medicaid will not receive the full benefit of the savings that will result from providing less uncompensated care,” Carter Price, the study's lead author and a mathematician at RAND, said in a news release. “Furthermore, these states will still be subject to the taxes, fees and other revenue provisions of the Affordable Care Act, without reaping the benefit of the additional federal spending, which will cost those states economically.” Read the full article here.