Health
1:38 am
Thu November 29, 2012

Coalition Emphasizes Economic Benefits Of Opting Into Medicaid Expansion

Expanding Medicaid to more adults in Missouri would have a positive impact on the state’s economy and residents, according to a new report.

Medicaid is a public health insurance program for the poor and disabled. Eligibility levels vary by state. The U.S. Supreme Court ruling last June upholding the federal health law gives states an option, as opposed to a requirement, of raising the adult eligibility into the program. So Missouri, whose eligibility level dropped significantly in 2005, must now decide whether to take part in an expansion.  

For the first three years, starting in 2014, the federal government would pay for the entire expansion. States would then pick up 10 percent of the tab by 2020. The new report, commissioned by the Missouri Hospital Association and the Missouri Foundation for Health, projects that during those first six years, Missouri would get about $8.2 billion in federal funds for the expansion. The state would spend an additional $333 million from its general revenue budget.

The report, done by researchers at the University of Missouri, focused on the economic impact of an expansion and found it would help curb rising insurance premiums, lead to more than 20,000 jobs in the state, as well as new, associated tax revenue streams. The report concluded all of this would in turn offset the costs of expanding the program.

“It makes 100 percent fiscal sense to do this and no sense not to,” says Joe Pierle, head of Missouri’s Primary Care Association and of a newly formed coalition in support of an expansion.

The long term costs of an expansion still worry Missouri lawmakers, and many remain opposed to expanding a program that already comprises such a large portion of the state’s budget.

“We don’t want to just flat out expand Medicaid,” Republican House Speaker Tim Jones recently told KCUR’s Up To Date. “It [the program and its costs] already expands every year.”

Listen to Tim Jones talk to Up To Date's Steve Kraske.

Jones said he is interested in looking at ways to improve the program and would be open to new ideas.

The new report projects that about 161,000 previously uninsured adults would gain coverage under an expansion. More would be eligible, but the analysis assumes not everyone would enroll.

The expansion would create a healthier workforce, according to Herb Kuhn with the Missouri Hospital Association, while lessening the impact of upcoming payment cuts to hospitals that care for people who don’t have coverage. Missouri currently ranks near the top for the total amount of federal payments it gets for such care.

“Cuts to health care providers to the state are locked in and they’re booked as part of the federal law,” says Kuhn. “And those will start to hit pretty hard across the state. And so an opportunity to recover that and to manage that issue is critical.”

Missouri governor Jay Nixon did not take a stance on an expansion prior to getting re-elected earlier this month. He’s slated to make a major health policy announcement in Kansas City later today.

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This story is part of a reporting partnership that includes KCUR , NPR and Kaiser Health News.

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