By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Putting a Price Tag on the Decision to Opt-Out of the Medicaid Expansion
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Health Reform > Putting a Price Tag on the Decision to Opt-Out of the Medicaid Expansion
Health ReformPolicy & Law

Putting a Price Tag on the Decision to Opt-Out of the Medicaid Expansion

Brad Wright
Brad Wright
Share
6 Min Read
Image
SHARE

Conservative opposition to the Affordable Care Act is old news. Even after the Supreme Court ruling last year, it was quickly established that–given the option–many traditionally Republican states would not be participating in the Medicaid expansion. I’ve written before about the irony that the very states choosing to opt-out of the Medicaid expansion are the ones who would benefit from it the most, because a higher proportion of their population is uninsured, their residents’ health is generally worse, and the amount of federal matching funds they’d bring into their states is higher.

Conservative opposition to the Affordable Care Act is old news. Even after the Supreme Court ruling last year, it was quickly established that–given the option–many traditionally Republican states would not be participating in the Medicaid expansion. I’ve written before about the irony that the very states choosing to opt-out of the Medicaid expansion are the ones who would benefit from it the most, because a higher proportion of their population is uninsured, their residents’ health is generally worse, and the amount of federal matching funds they’d bring into their states is higher. But new research from the RAND Corporation puts a price tag on the states’ decision to opt-out and it has me wondering if what we’re seeing isn’t just farsighted politics at its best. Let me explain.

In a recent Health Affairs article, Carter Price and Christine Eibner report the results of a microsimulation model to predict insurance coverage and federal and state spending under several different scenarios tied to the Medicaid expansion. They find that if the 14 states currently vowing to opt-out of the Medicaid expansion keep their word, there will be a number of consequences compared to a scenario in which all states participate in the expansion. First, there will be an additional 3.6 million persons who remain uninsured. Second, the Federal government will save about $8.4 billion. That figure comes about because the Feds will spend $21.3 billion less on Medicaid (remember, fewer people are enrolled), but $11.2 billion more on subsidizing premiums for individuals who would have been eligible for Medicaid but instead ended up enrolling in the health insurance exchange, and $1.7 billion more on uncompensated care. Third, and finally, states that opt-out will lose out on $1 billion, because while their Medicaid costs decrease slightly, they will also have to pick up the tab for uncompensated care when Federal disproportionate share hospital payments are cut.

If you assume that these effects are spread evenly over the 14 non-participating states (they’re not, of course), it works out to the following: $71,428,571 per state in additional state spending for 257,143 fewer persons with insurance. In other words, each state is willing to pay about $278 for a person not to be insured. According to the Kaiser Family Foundation, in 2009, the average amount paid per Medicaid enrollee per year was $5,527. Thus, by 2020, when states would be responsible for 10% of these costs, that would equal $553. The conclusion: states would rather limit their total spending to $278 per person and get nothing in return, than pay an additional $275 so that each person could have health insurance, and face the possibility that that amount could increase over time.Image

More Read

australia health
The Impact of Global Health Crises on Personal Finance
Medicaid Expansion a Real Budget-Buster
How Healthcare Workers Can Smoothly Change Careers
How to Engage Patients: Start with Strategic Planning
New CMS Chief Confirmed by Senate

But I think there’s a bit more to it than that. As the authors write: “The decision to expand Medicaid would not have substantial effects on state budgets prior to 2017.” What we are seeing is less about math, and more about politics. First, with the mid-term elections in 2014, the GOP is hoping that the health insurance exchanges that will begin enrollment in October of this year will be a disaster and that they will pick up seats in Congress as a result. Then, with the Presidential election in 2016, the GOP is hoping that their resistance to the Medicaid expansion will have caused further disruptions to the implementation of “Obamacare” and they will be able to leverage that to win the White House. If they are successful on both counts, they may find that they are closer to repealing or seriously dismantling the Affordable Care Act. That matters to them. A lot. And they’re willing to gamble away billions of dollars in Federal matching funds in the hope that doing so will reclaim the Senate and the Presidency for Republicans. If at least one of those things doesn’t happen, I think you’ll see at least some states have a change of heart in 2017, and opt-in to the Medicaid expansion at that later date.

image: USHealth/shutterstock 

      

TAGGED:Medicaid Expansion
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

dental care
Importance of Good Dental Care for Health and Confidence
Dental health Specialties
October 2, 2025
AI in Healthcare
AI in Healthcare: Technology is Transforming the Global Landscape
Global Healthcare Policy & Law Technology
October 1, 2025
Choosing the Right Swimwear for Health and Safety
News
September 30, 2025
sports concussions
Concussion In Sports: How Common They Are And What You Need To Know
Infographics
September 28, 2025

You Might also Like

obamacare deductibles
BusinessFinanceHealth ReformPolicy & Law

Schizophrenia About High Deductibles

November 19, 2013
eHealthHealth careHospital AdministrationMarketing

What To Know About The Importance Of Healthcare Marketing

November 23, 2019

Health Insurance Unaffordable for Smokers?

January 29, 2013

New Regulation Threatens Agents, HSA Plans

December 13, 2011
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?