Medicaid expansion good for everyone
Since the Affordable Care Act, AKA Obamacare, has been upheld and any sort of repeal looks unlikely, the onus is now on state lawmakers to implement it in time for 2014, when the bulk of the law goes into effect. One portion of it, the expansion of Medicaid to cover families who earn as much as 138 percent more than the federal poverty line, is entirely voluntary. However, it should be a no-brainer to support, as it benefits not only the uninsured, but also hospitals, the insured, and more generally, the economy.
Michigan has an estimated 676,000 people who would be eligible for Medicaid coverage following the expansion — people who would not be eligible to fit into the program as it is now, and who wouldn’t be able to get the tax credits being offered to offset the cost of private insurance beginning in 2014. The law states that the U.S. government must pay for the Medicaid expansion through 2016. After that, it will reduce the amount it funds to 90 percent by 2020, and Michigan would make up the difference. For reference, Michigan’s 2013 Medicaid match from the federal government was about 66 percent.
This seems pretty straightforward to me — we get to help out several hundred thousand of our neighbors and fellow residents, and the cost isn’t anything awful. And there are other benefits to consider for the rest of us, too.
Part of the current cost to individuals and businesses with private insurance plans is paying for the uninsured when they go to the emergency room. The Center of Healthcare Research and Transformation projects that statewide, employers and individuals would see savings of $640 million to 985 million over 10 years if the Medicaid expansion goes through, based solely on the fact that there would be fewer uninsured.
This is to say nothing of the fact that with preventative treatment and regular health care, people would be more inclined to visit their regular doctor before a trip to the emergency room is necessary.
Expansion is also a boon to hospitals, which receive what is known as “disproportionate share payments” as compensation for treating uninsured patients. The Affordable Care Act reduces these, with the idea that there would be fewer people being uninsured. As a result, if the cost of treating a larger-than-expected number of uninsured people is greater than the payments the hospital gets, it would be facing budgetary problems.
Finally, the expansion would help out the Michigan economy. Since the federal government would be increasing its Medicaid dollars to the state, Michigan would be able to save an estimated $1 billion over the next 10 years (according to the Center for Healthcare Research and Transformation). Meanwhile, its costs after 2020 would range from $40 million to $50 million for Medicaid.
The Michigan League for Public Policy also estimates there would be about $20 billion in new federal spending in the Michigan economy through the expansion over the same 10-year period. I imagine a lot of that would be going toward the health care field, but there is also that knock-on effect of people being generally healthier and having a bit more money in their pockets from smaller insurance premiums.
Michigan Senator Bruce Caswell has introduced a bill to block the Medicaid expansion, which is currently in committee, while Gov. Rick Snyder has not made any public position known on the matter. Honestly though, I don’t see any reason not to go for it. There are a lot of hardworking people in this state who simply aren’t eligible for state programs and can’t afford private insurance. I was one of those people for about a decade myself, and it was nerve-wracking. Because I worked only part-time, I was not eligible for my old job’s insurance program, and again, because I was part-time, I couldn’t afford to get my own. Between going to school and dealing with Michigan’s economic troubles over the past 10 years, I was in no position to get anything that could help me out.
For me, the people this would help out are not some faceless mass; they are people like me from a couple years ago: parents with kids who live paycheck to paycheck, and people who just haven’t been able to catch a break. It may eventually cost the state some money, but with the savings from the first few years, they should have enough of a cushion to come up with a long-term solution.
And really, when it comes down to it, I don’t like the idea of putting a price tag on people’s well-being.