Expanding Medicaid Saves Money - WOW
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Medicaid
Medicaid is a joint program between the Federal government and individual states. The Federal government picks up most of the cost of the program. The program is overseen by the Center for Medicare and Medicaid Services (CMS) within the Department of Health and Human Services (HHS).
At the height of the COVID-19 pandemic 94 million of us got our insurance there. Since the pandemic is over that number has dropped to about 84 million. Recall that many (5 million so far) lost their insurance for procedural/administrative problems - that included 1.8 million children. Here is a recent article we wrote about that. Each state decides how Medicaid will work for them. It is a laboratory of 50 different ways to provide access to healthcare. Of course, some work better than others, prescription formularies vary from state to state, which can be deadly for some.
When the Affordable Care Act became law in 2010, the Federal government offered to expand Medicaid availability to those whose incomes were up to 138% of the Federal Poverty Limit (FPL) including adults without children. It was a generous offer. The Federal government was going to pick up almost all the cost for new enrollees and for for several years so that by 2020 states would only pay 10% of the cost for the new enrollees. In comparison, the federal match for traditional Medicaid populations varies from state to state based on per capita income, ranging from about 78 percent in Mississippi to 50 percent in New York and Alaska. This means most states pay between 25 percent and 50 percent of the cost for each person covered under traditional Medicaid — considerably higher than what they pay for the population covered under expansion.
I was reading an interview with the Republican governor of Louisiana recently. Louisiana is one of the ten states that have chosen not to expand Medicaid. The governor said he did not want to incur the extra expense of more enrollees. Compared to other states, Louisiana has the 8th highest death rate of 1056/100,000/year. The top two causes are cardiovascular issues and cancer. It ranks 49th in life expectancy (73.1 years) according to USA Facts.
When I read that comment by the governor I was reminded of a conversation I had with Adam Schiff, years ago, when he described a constituent telling him that if you can’t afford health insurance, then you deserve to die. Schiff told me that he heard this over and over again, off the record, from many. This is economic eugenics. Hold that thought and remember that when people have ready access to healthcare, problems are handled earlier at lower expense and outcomes are generally better.
Since covering more people with expanded Medicaid sounds like it might really cost more, the Commonwealth Fund investigated how states were doing with Medicaid in 2020, 4 years after the expansions took place and the results were surprising.
According to the latest data, states that expanded eligibility for their Medicaid programs have reaped significant savings, both within their Medicaid programs and in other areas of their budgets. Their new study complements a growing body of evidence showing that Medicaid expansion has given people greater access to care and made care more affordable for them while also saving states valuable resources.
An analysis of data from the National Association of State Budget Officers shows expansion increased total Medicaid spending between 2015 and 2019. However, state Medicaid spending decreased or remained flat over the same timeframe. Additional analysis of state Medicaid spending found expansion was associated with a 4.4 percent to 4.7 percent reduction in state spending on traditional Medicaid. Here is a link to the findings.
Historically, many states have supported programs and services for the uninsured—mental and behavioral health programs, public health programs, and health care services for prisoners—with state general fund dollars. With expansion, many of the beneficiaries of these programs and services are able to secure Medicaid coverage in the new adult category, which means states can fund these services with enhanced federal—not state—dollars.
Revenue Gains: Nearly all states raise revenue through assessments or fees on providers and/or health plans. As provider and health plan revenues increase with expansion, this also translates into additional revenue for states.
Summary/ACTION
Medicaid Expansion saves states money overall. By insuring more people, they are able to lower their overall expenditures and save taxpayers money and still insure more people.
I think if you live in any of the 10 states that have not yet expanded Medicaid you might want to let your representatives in the legislature and your governor know that they can save money in the total state budget by insuring more people. Those states are Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin, Wyoming. You can find their email addresses here
Here is a sample text. I recommend you send it in emails so the hyperlinks remain.
“I am your constituent and I just learned that states that expand Medicaid save money in their total state budgets.
An analysis of data from the National Association of State Budget Officers shows expansion increased total Medicaid spending between 2015 and 2019. However, state Medicaid spending decreased or remained flat over the same timeframe.
Additional analysis of state Medicaid spending found expansion was associated with a 4.4 percent to 4.7 percent reduction in state spending on traditional Medicaid. Here is a link to the report (link)
Long story short - cover more people, save the state money, improve public health by giving people access to healthcare and thus further reduce expenses.
I want you to give this moneysaving, lifesaving capability serious consideration. Thank you.”
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Thanks for this careful take on the compelling economics of Medicaid expansion. My view: it's not really about economics. It's about white supremacy.
Exhibit A: Seven of the ten Medicaid non-expansion states seceded from the Union and became part of the Confederacy. If you think that's coincidental, there's a bridge in Brooklyn I'd like to sell you.
Exhibit B: Of the other three non-expansion states, only one (Wisconsin) was fully a "free state" during the Civil War. One out of ten. Another, Kansas, was fully a "free state" in name only. Remember "bloody Kansas"? Kansas residents fought their own vicious, intensely violent version of the Civil War starting years before the War's official outbreak in 1861: https://en.wikipedia.org/wiki/Bleeding_Kansas.
The tenth non-expansion state, Wyoming, didn't become a state till decades later, in 1890. For the purpose of this historical narrative, it didn't exist.
So, of the nine present-day Medicaid non-expansion states that existed as states in the Civil War, seven were traitors who fought to keep Black folks enslaved rather than keep the USA together. Seven out of nine. I'd call Kansas — literally and figuratively — a split decision. So, kinda seven-and-a-half out of nine ... 83%.
I leave you to draw your own conclusions about the deep-seated moral filth revealed in this rough analysis.
One more thing. Why do we have two separate federal programs in the first place, Medicare and Medicaid? Medicare was originally envisioned as a program of universal care. Southern Democrats — Dixiecrats, the "solid South" congressional voting bloc — said no way, 'cuz it would mean givin' Black folks — known by the n-word — the same rights and resources as White folks. Dixiecrats vowed to let everyone sicken and die before allowing that to happen. So we ended up with two programs and a broken system. Maybe Alan Unell has already written about this racist origin story. If not, hey, how about it?!
Side note: the same racist policy and strategy prevented communities from keeping the beautiful public pools that families had long enjoyed. White supremacists had these pools filled with dirt, wiped off the map, rather than share these treasured amenities with people of color.
So yeah, the economics of Medicaid expansion make perfect sense — if only it were really about economics and not white supremacy.