(Salt
Lake City, UT) – A report released today during the Medicaid Expansion Options
Community Workgroup meeting will provide information for Utah policy makers as
they consider whether to expand the state’s Medicaid program under the
Affordable Care Act (ACA). The report,
produced by Boston-based Public Consulting Group (PCG), does not make
recommendations on how the state should proceed, but rather analyzes the costs
and benefits associated with five potential expansion scenarios.
The
PCG report found that the ACA will increase Medicaid’s overall cost to the
state, and that those costs increase over time as the federal government’s
Medicaid reimbursement rate shrinks.
“This
report is one of many considerations I encourage the committee to take into
account. Our workgroup will undoubtedly
identify additional items that will need to be thoroughly considered before
providing our report to the governor,” said Utah Department of Health Executive
Director David Patton. “The bottom line
is that each and every scenario comes with significant costs to the
taxpayer. But there are also benefits,
both human and financial, and we must remain focused on finding the best way to
deliver high-quality, affordable health care to Utahns.”
The
PCG report models the costs and benefits of five different scenarios, four
optional expansion scenarios in addition to the mandatory changes to Medicaid
required by the ACA. For each scenario,
the report analyzes the cost of expansion due to increased enrollment and
administrative costs. It also estimates
potential savings, primarily to other state and county public assistance
programs whose clients would become eligible for Medicaid. The PCG report also analyzes the savings Utah
hospitals and community health centers would achieve from reducing the amount
of uncompensated care they provide. Finally,
the report estimates how expanding Medicaid may impact the state’s overall
economy, as well as the impact it may have on creating new jobs.
The
PCG report found significant costs will come from mandatory changes to Medicaid
eligibility and from increased enrollment due to the ACA’s requirement that all
residents have health insurance. Some of
the mandatory changes include the removal of a resource test for some
eligibility groups as well as an increase in the income eligibility level for
some children. The state will bear the
costs of these mandatory changes regardless of whether it chooses to expand the
Medicaid program. The PCG report
estimates over the next 10 years the mandatory changes will:
• Increase Medicaid enrollment by 60,202 adults
and children
• Increase Medicaid service and administration
costs by $762 million (due to federal matching money, the state share of this
increase will be $213 million)
• Generate an additional $20 million in state tax
revenues
• Generate an additional $16 million in county
tax revenues
• Generate $516 million statewide in economic
impact, create 747 new jobs
The
remaining four scenarios modeled in the PCG report all assume the state will
expand its Medicaid program. The PCG
report estimates over the next 10 years the costs and benefits of the full
expansion scenario (traditional Medicaid benefits for adults earning up to 138
percent of poverty) will be:
• 123,586 additional adults would enroll in
Medicaid
• Medicaid service and administration costs will
increase by $3.2 billion (due to federal matching money, the state share of
this increase would be $260 million)
• State public assistance programs would save
$156 million
• County public assistance programs would save
$39 million
• Generate an additional $113 million in state
tax revenues
• Generate an additional $90 million in county
tax revenues
• Hospitals would save $814 million in
uncompensated care
• Generate $2.9 billion statewide in economic
impact, create 4,160 new jobs
A
similar cost/benefit analysis for each of the other four expansion scenarios
can be found in the full report. The
report is available at www.health.utah.gov.
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Media Contact:
Tom
Hudachko
Public
Information Officer
(o)
801-538-6232
(m)
801-560-4649
