Healthcare

Study: Medicaid expansion may save state money

 

Legislators heard details of a Georgetown study that says Medicaid expansion under Obamacare could save the state money rather than be the huge drain that Gov. Rick Scott fears.

jdorschner@MiamiHerald.com

Florida would save money over the next decade — not lose billions as Gov. Rick Scott has argued — by accepting Medicaid expansion under federal healthcare reforms, according to a detailed economic study.

Miami-Dade legislators and healthcare industry leaders, getting together on Monday, heard about the report by Georgetown University — the most positive yet on a highly debated provision of what is often called Obamacare.

Jack Hoadley, a senior researcher with the Georgetown Health Policy Institute, said the study was the first to calculate spin-off savings in other state programs if Florida accepted the expansion, which over the next 10 years could bring $26 billion in federal funds to provide insurance to an estimated 815,000 to 1.3 million Florida residents who are now uninsured.

In Miami-Dade, expansion would cover an additional 150,000 to 225,000, according to the Georgetown projections. That reduction in the uninsured would bring huge relief to the county’s hospitals, which by federal law must treat anyone who comes to the emergency room, regardless of ability to pay.

The top-level meeting, at the United Way of Miami-Dade headquarters, was convened by United Way, Health Council of South Florida and Health Foundation of South Florida.

At the very least, the Georgetown findings and other recent analyses have some critics reconsidering opposition to the 2010 Affordable Health Care Act.

State Sen. Rene Garcia, R-Hialeah, who previously was an “absolute no” vote against Medicaid expansion, said after the meeting that he was now “open to the thought” that expansion makes sense.

State Rep. Eddy Gonzalez, R-Hialeah, said he was still concerned about the debt-ridden feds’ ability to fund Medicaid over the long term, but “we are looking at all the options.”

Estimates about the real costs of expansion have varied wildly based on the law, which requires the federal government to pay all costs of the expansion for the first three years. Starting in 2017, the state will start paying a small share, which will reach 10 percent of the expansion costs for 2020 and beyond.

Gov. Scott, who has long been critical of Obamacare, contended in December that expansion would cost Florida taxpayers more than $26 billion over 10 years. Opponents and healthcare experts criticized that estimate as way too high, and earlier this month the state’s Agency for Health Care Administration gave a much lower estimate of $3 billion for the decade.

That was lower even than a report by the Kaiser Commission on Medicaid and the Uninsured, a Washington research group, which in November estimated that expansion would cover an additional 1.2 million residents at a cost to the state of $5.4 billion over 10 years.

Georgetown’s Hoadley said Monday that the Kaiser study used only rough data for all 50 states, while the Georgetown study, funded by two Florida nonprofit foundations, looked in detail at how Medicaid expansion would save money in other areas. The Georgetown study found that the state would have to spend less for safety-net hospitals such as Jackson Health System, mental-health and substance-abuse programs and the medically needy program.

Hoadley said the savings calculations were “a very cautious estimate.”

The Georgetown report projected that the state would save $300 million in 2014, the first year of Medicaid expansion, and $100 million in 2020, when the state would be paying for 10 percent of the expansion costs.

The Georgetown study found that expansion was especially important in Florida, where almost one in three — 30 percent — of nonelderly adults are uninsured, compared to 18 percent nationwide.

In South Florida, the figures are even higher for uninsured non-elderly adults: 57 percent in Hialeah, 50 percent in the city of Miami, 48.5 percent in Deerfield Beach and 31.2 percent in Kendall.

Hospitals strongly support the expansion. On Monday, Phillis Oeters, an executive with Baptist Health South Florida, told legislators that hospitals have already seen their Medicare and Medicaid payments reduced greatly in other areas.

“Enough is enough,” she said. “Hospitals can’t take it anymore.”

A study done for the Florida Hospital Association estimated that the infusion of federal funds from Obamacare would add 56,000 jobs to the state.

Read more Healthcare Reform stories from the Miami Herald

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