The economic stimulus of Medicaid
Posted by AzBlueMeanie:
if our ideological extremist Tea-Publican Governor and legislature say no to the expanded Medicaid provisions of the Affordable Care Act, they are also saying no to economic stimulus and job creation. You read that right.
Sarah Kliff at Ezra Klein's WonkBlog reports Medicaid’s stimulative effect:
Here’s one factor governors may want to weigh as they consider participating in the health law’s Medicaid expansion: Study after study has found that federal Medicaid dollars spur economic activity beyond the initial investment.
Researchers find that a dollar of Medicaid spending increases spending both in the health-care sector and in other industries.
“For every dollar that a state spends, federal funding filters through the state economies,” says Robin Rudowitz, associate director for the Kaiser Commission on Medicaid and the Uninsured. “That tends to go both into health service vendors as well as other sectors.”
Medicaid acts as a stimulus in two ways. First, increased federal spending on health care can, in tough budget times, free up state dollars for other spending. Medicaid spending can also ripple through the private sector, stimulating increased employment that leads to higher household spending.
Rudowitiz recently reviewed 29 state-level studies of Medicaid’s stimulative impact. Across the board, she says, “it was pretty consistent that Medicaid spending did generate economic activity.”
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One recent study found that every $100,000 in stimulus dollars increased employment by 3.8 job years. Each stimulus dollar had a multiplier of 2, meaning that every $1 of Medicaid spending resulted in a $2 increase in gross domestic product.