The cost of rejecting expanded Medicaid


Posted by AzBlueMeanie:

Ezra Klein reports on a new study by the Rand Corporation today in the Wonkbook: The terrible deal for states rejecting Medicaid:

Curious why some hardcore conservative governors, including Jan
Brewer of Arizona and Rick Scott of Florida, are fighting with their
legislators to accept Obamacare’s Medicaid expansion? A new study in the journal Health Affairs article will clear it up.

The study, by the Rand corporation, looks at the 14 states that have
said they will opt out of the new Medicaid funds. It finds that the
result will be they get $8.4 billion less in federal funding, have to
spend an extra $1 billion in uncompensated care, and end up with about
3.6 million fewer insured residents.

So then, the math works out like this: States rejecting the expansion
will spend much more, get much, much less, and leave millions of their
residents uninsured. That’s a lot of self-inflicted pain to make a
political point.

It’s a truism of health-care politics that the uninsured are
impossible to organize. But Obamacare creates an extraordinarily unusual
situation. The Affordable Care Act will be implemented in states that
reject Medicaid. There will be huge mobilization efforts in those
states, too, as well as lots of press coverage of the new law. The
campaign to tell people making between 133 and 400 percent of poverty
that they can get some help buying insurance will catch quite a few
people making less than that in its net. And then those people will be
told that they would get health insurance entirely for free but for an
act of their governor and/or state legislature.

Typically, in politics, there’s no guarantee that winning an election
will get anything big done. Politicians talk about ending wars and
reforming health care, but then they take office, have one meeting with
the chairman of the relevant committee, and back off. Here, however,
federal law already says Americans making less than 133 percent of
poverty are entitled to Medicaid coverage. All that needs to happen is
for recalcitrant state governors and legislators to get out of the
The publicity the benefit will get, the value it has to the target
population, and the clear political path to getting that benefit all
present an extraordinary organizing opportunity.

Only the reckless and fiscally irresponsible would reject this deal out of ill will and spite for President Obama, and radical ideological extremism. Their rantings and ravings should fall on deaf ears.

UPDATE: More from Think Progress, STUDY: States Refusing To Expand Medicaid Will Lose Out On More Than $8 Billion:

“Our analysis shows it’s in the best economic interests of states to
expand Medicaid under the terms of the federal Affordable Care Act,”
Carter Price, the study’s lead author, explained
in a press release. “State policymakers should be aware that if they do
not expand Medicaid, fewer people will have health insurance, and that
will trigger higher state and local spending for uncompensated medical

* * *

Considering the fact that rejecting the Medicaid expansion represents a
bad fiscal move for states, some Republican leaders have suggested that
it’s not actually a conservative position. This week, Kasich pointed out
that Ronald Reagan — who approved several expansions of the federal
insurance program to additional populations, like pregnant women and
low-income children, during his time in office — would likely be in favor of expanding Medicaid.