Medicare trustee doubts future funding for Medicaid expansion

A Medicare trustee is questioning whether the federal government will maintain its commitment to foot most of the cost of expanding Medicaid under the healthcare reform law.

Charles Blahous released a report Monday cautioning states to "consider the likelihood that federal financing support may be ultimately reduced from current schedules."

"From a practical perspective, it is quite unlikely that the federal government will make the full amount of Medicaid payments now scheduled under law," Blahous wrote, citing rising U.S. debt and pressure to reduce it. 

Under the Affordable Care Act, states can choose to expand Medicaid eligibility to everyone at or below 133 percent of the federal poverty line using mostly federal dollars.

The federal government promises to cover the entire expansion tab until 2017, when its share of the cost will gradually fall to 90 percent.

Governors in 24 states, including eight Republicans, have agreed to expand their Medicaid programs under this policy. State legislatures must approve the decision in many cases.

On Monday, Blahous said that state Medicaid costs are already projected to expand, and he questioned the quality of care within the program.

"The quality of health services in Medicaid is often fiercely debated, but one factor interfering with access to care under the program is the number of providers unwilling to accept its comparatively low provider reimbursement rates," he wrote.

The report was published by the Mercatus Center, a free-market think tank at George Mason University where Blahous is a senior research fellow.

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