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States Rejecting Medicaid Expansion Forgo Billions in Federal Funds

John Commins, for HealthLeaders Media, December 5, 2013

The study is the first to calculate the net cost to taxpayers in states turning down Medicaid expansion. Using data from the Urban Institute projecting Medicaid enrollment and spending under the law in the year 2022, researchers estimated the effects of states' decisions about whether to accept the health reform law's expansion of the Medicaid program to residents with incomes at or below 138% of the federal poverty level ($32,499 for a family of four).

The expansion became voluntary for states after the U.S. Supreme Court's 2012 ruling. Medicaid is mostly funded by the federal government, which pays 100% of the expansion costs through 2016. The federal contribution will be reduced to 90% by 2020, where it will remain after that.

The Commonwealth Fund study estimates that if all states expanded Medicaid under the law, as many as 21.3 million people would gain coverage by 2022. In addition to improving access to care and financial security for the newly insured, healthcare providers in states would benefit from reduced uncompensated care costs, the study suggests.

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2 comments on "States Rejecting Medicaid Expansion Forgo Billions in Federal Funds"


Todd (12/15/2013 at 11:40 AM)
"In addition to improving access to care and financial security for the newly insured..." Exactly how does this expansion guarantee access? Providers have to take on all those additiona patients at low reimbursements.

Robert Trinka (12/5/2013 at 5:02 PM)
Irrespective of the short run benefits to a state of expanding Medicaid and accepting Federal funds, the fact is that expanding the Medicaid program will create massive liabilities for states that are participating. The long run unfunded liabilities of this program will be in the trillions of dollars over the next 10+ years. As a state taxpayer, I fully support my state's decision not to take on these liabilities for a short-term fix. And consider whether the Federal Government will be able to meet its obligations under the program and make the payments to the states as promised - that is not guaranteed. There are other, less expensive and less risky ways to provide healthcare to a state's population.