GOP raises alarm on higher ObamaCare Medicaid costs

GOP raises alarm on higher ObamaCare Medicaid costs
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Two top Republicans are raising concerns about the cost of new Medicaid enrollees who signed up under ObamaCare’s expansion of the program. 

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Senate Finance Committee Chairman Orrin HatchOrrin Grant HatchTrump to award racing legend Roger Penske with Presidential Medal of Freedom Trump awards Presidential Medal of Freedom to economist, former Reagan adviser Arthur Laffer Second ex-Senate staffer charged in aiding doxxing of GOP senators MORE (R-Utah) and House Energy and Commerce Committee Chairman Fred Upton (R-Mich.), in a letter to the administration, point to recent estimates showing new enrollees under ObamaCare cost more per person than standard enrollees. 

A report from a federal government actuary in July found that enrollees who are newly eligible under ObamaCare’s expansion of Medicaid cost $5,517 per person on average, 19 percent higher than standard enrollees. 

Upton and Hatch write that the “double-digit increase in costs is potentially concerning.”

ObamaCare expanded eligibility for Medicaid, the government health insurance program for the poor, to people up to 138 percent of the poverty line — or about $33,000 for a family of four. The federal government picks up the entire cost of expansion in the early years. 

“States effectively lack economic incentives to be prudent purchasers for the newly-eligible population, because the federal government pays 100 percent of the cost of care for this population,” Hatch and Upton write. 

The lawmakers say they are asking the federal Centers for Medicare and Medicaid Services questions to ensure that the administration “is conducing robust oversight of federal dollars.”

Defenders of the Medicaid expansion note that it is expanding coverage. The same federal actuary report finds that 4.3 million people gained coverage through the Medicaid expansion in 2014. 

The report also notes that costs for newly eligible Medicaid enrollees are projected to be 11 percent lower than standard enrollees in 2015. That change is partly because pent-up demand for coverage among sicker people will have calmed down after the first year. 

The Obama administration is pushing more Republican-run states to expand the program, with 30 states having done so up to now.