Medicaid expansion is supported by Big Medicine, but the numbers don’t work

Medicaid expansion is supported by Big Medicine, but the numbers don’t work

by
Fred Birnbaum
August 3, 2016
Fred Birnbaum
Author Image
August 3, 2016

Visit HealthyIdaho.org, a website funded by the Idaho Hospital Association, and you will see a smiling young woman in a classroom working with two young children. What you won’t see on that website are accurate numbers about Medicaid expansion costs in Idaho.

The website peddles the notion that Medicaid expansion will help Idahoans’ health and save money for The Gem State and her counties. The following statement from the site notes, the money saved could be funneled into education:

Proposals are out there to fix Idaho’s failing education system. While there are many questions how to fund these solutions, one thing is clear: $173 million in tax savings by eliminating redundant state and local government spending is a good start. Our state has the opportunity to bring back more of our federal tax dollars to cover the health care costs of many uninsured Idaho residents. This can allow those state and local tax dollars we are currently spending – $173 million over 10 years – to be repurposed for critical needs like education. The Healthy Idaho Plan is a sensible, efficient solution that gives us the flexibility to spend where it matters.

The Healthy Idaho Plan cited is the Idaho version of Medicaid expansion. It is pure Medicaid for those earning up to 100 percent of the Federal Poverty Level (FPL), and “premium support” – provided by the taxpayer, of course – for those earning up to 138 percent of FPL.

Sounds like a great story, right? Help people with medical needs and funnel the savings into education. Except it is a fictitious story, it is not true.

What if the $173 million in savings were to evaporate with Medicaid expansion? The actuarial firm Milliman calculated in November 2014 the $173 million in savings that the HealthyIdaho.org website highlights. But, the website fails to reflect the fact that Milliman updated its calculations during January 2016. The new report details how the projected $173 million in savings have morphed over 10 years into nearly $187 million in projected net costs to the state. That is a $361 million negative swing!

Is it unreasonable to request that proponents of Medicaid expansion use accurate numbers? It would be one thing if these were two competing reports; however, the negative swing was calculated by the same firm using the same methodology. The updated Milliman report reflects that higher state funding will not be offset by state and county savings from current programs.

I have a second simple request, that the Idaho Hospital Association reveal how much the revenue in excess of expenses (what non-profits call income) will increase for hospitals if Medicaid expansion occurs. When the association updates its website with the correct Medicaid cost numbers, it would be nice of them to reveal how much they benefit from Medicaid expansion too.

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