It turns out that keeping Missourians healthy by expanding access to Medicaid is also a great prescription for the state’s financial health.
An analysis by Gov. Jay Nixon’s budget office calculates the state would free up more than $311 million over the next three years by increasing its very low Medicaid eligibility limits to the level called for in the federal Affordable Care Act.
That is badly needed money which could be spent on schools, colleges and universities, roads and multiple other needs.
Increasing Medicaid eligibility would bring as many as 300,000 persons into the state’s Medicaid program — a positive development. The federal government would pay all of the costs of the expansion for the first three years, and never less than 90 percent of those costs.
Washington would also pick up some of the health care expenses the state is currently shouldering, such as treatment for the mentally ill and health care for pregnant women and some blind, disabled and frail elderly Missourians.
In addition, Missouri would receive a boost in income tax and sales tax revenue as a result of hospitals and the rest of its health care network hiring people and purchasing equipment to accommodate an expected increase in patients.
The budget office’s analysis assumes tax revenue increases of more than $126 million over three years. A study done by the MU School of Medicine for the Missouri Hospital Association anticipated a much bigger financial bounce, as the hiring in the health care sector would be multiplied in other industries, such as construction.
The projected financial benefits of a Medicaid expansion diminish somewhat after three years. But at no point in the eight-year timeline prepared by the budget office does the expansion actually cost Missouri money.
The budget analysis adds more weight to the case for expanding Missouri’s Medicaid eligibility threshold, which currently is one of the nation’s lowest.
A working parent in Missouri who qualifies for Medicaid can earn no more than 19 percent of the federal poverty level — an annual salary of just more than $4,000 for a family of four. Childless adults are not eligible at all.
The Affordable Care Act sets the eligibility limit in all states at 133 percent of the poverty level. But a Supreme Court decision this year made the increase optional for states.
Nixon, a Democrat, is pushing for the expansion. But antipathy to the federal health law, or “Obamacare,” runs high in the Republican-controlled Missouri legislature.
Opponents are having difficulty opposing a Medicaid expansion on economic or financial grounds, however.
The state’s hospitals strongly favor getting more of the state’s insured population under the Medicaid umbrella, especially because federal payments to hospitals which treat high numbers of uninsured patients are scheduled to be phased out.
The Missouri Chamber of Commerce, a Republican-leaning group, also favors a Medicaid expansion because of the economic boost it would bring.
Republican opponents are hauling out the usual arguments about adding to the federal debt and increasing social dependency.
But a number of states already have either committed to the expansion or are leaning toward doing so.
They will reap the many economic and social benefits of a stronger health care network, while Missourians would continue to pay taxes and gain nothing.
Most of the Missourians who would gain coverage under the expanded limits have jobs. They aren’t looking to the state for a handout, but rather for the ability to get preventive care and see a doctor when they are sick.
In Kansas, a spokesman said last week that Gov. Sam Brownback’s administration is still working on an estimate of how many Kansans would be included in a Medicaid expansion, and what it would cost the state.
Brownback has shown little interest in participating in any aspect of “Obamacare.” But an accurate analysis may well show that a Medicaid expansion would also save Kansas money.
And that would be just what the doctor ordered for a state that has dug itself into a huge fiscal hole.
Copyright The Kansas City Star. Reprinted with permission.