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Study: Medicaid expansion is cheap for states
Implementing the Medicaid expansion in President Obama's healthcare law wouldn't cost the states much money, according to a new report from the Kaiser Family Foundation.
Republican governors are under enormous pressure not to expand their Medicaid programs, as conservatives look for any way to undermine the Affordable Care Act now that it has survived the Supreme Court as well as the 2012 election.
Nearly every Republican governor has rejected the expansion, citing the additional costs to state governments that are still recovering from the recession. But according to the new Kaiser analysis, states' additional costs would be small.
The federal government will pays for 100 percent of the expansion in the first few years, then its share begins to drop but remains above 90 percent. The Obama administration has touted that free money as a reason for states to accept the expansion — especially now, before federal payments begin to decline. States can drop out at any time.
In fact, eight states could actually see a decrease in their overall Medicaid spending if they implement the Medicaid expansion, Kaiser said. Those states — Connecticut, Delaware, Iowa, Massachusetts, Maryland, Maine, New York and Vermont — had already expanded their Medicaid eligibility before the Affordable Care Act took effect, and would therefore get extra federal funding for coverage that is already in place.
The healthcare law initially envisioned every states expanding its Medicaid program to cover people at or below 133 percent of the federal poverty line. But the Supreme Court said states must have the ability to opt out of the expansion if they want to.
If every state implemented the expansion, about 21.3 million uninsured people would gain coverage, Kaiser said.
