Echoing what President Obama and other Democrats have been saying for more than three years now, a new report urges the 19 Republican-run states that have not embraced the Affordable Care Act’s expansion of Medicaid to reverse course for the sake of their economies and the health of their citizens.
The study by the Washington, D.C.-based Urban Institute reiterates a number of familiar arguments in favor of the Medicaid expansion, including the fact that states only fund about 10 percent of the expansion of services to those making between 100 percent and 133 percent of the federal poverty level. The federal government picks up the rest of the tab.
But it also reports that the states resisting the expansion could save their hospitals $27 billion in uncompensated care if they swallowed their pride and accepted Obamacare, a proposition that many of those states’ Republican leaders cannot bear to contemplate.
States that expanded Medicaid generally saw much greater drops in their uninsured rate than states that rejected the expansion. Texas, which has been a hold out, remains the only state in the country where more than 20 percent of residents still lack coverage.
Of course, when fewer people have coverage, that means more uninsured people are showing up to the emergency room when they need medical care. Many of them cannot pay the bill and never do, leaving the hospital to pass the cost of the uncompensated care on to others.
It’s not just the states that are losing money. The federal government would spend $43 billion less on uncompensated care and a whopping $129 billion less on subsidies for private plans offered through the ACA exchange if the states would embrace the Medicaid expansion.
It’s important to note, however, that the $129 billion less spent on the exchanges would not be a total gain for taxpayers; much of that sum would be redirected to expand Medicaid, although it is not clear how much.
“It appears that Medicaid expansion is a fiscal win for states,” Kathy Hempstead of the Princeton, New Jersey-based Robert Wood Johnson Foundation, which partnered with the Urban Institute on the study, said in a statement. “In addition to increasing coverage, expansion has the potential to reduce state expenditures, generate revenue, and create jobs.”
A number of states have changed their mind about the Medicaid expansion since the ACA was implemented at the beginning of 2014. Louisiana, Montana, Alaska, Indiana and Pennsylvania have joined the ranks of the expanders, either as a result of a change in leadership or a change in heart among existing political leaders.
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