Expanding Medicaid Makes Fiscal Sense, State Economist Says
Florida's chief economist says the state can't afford to leave $26 billion in federal funds sitting on the table. That's the money the state would get under the Affordable Care Act if it expands the Medicaid program.
However, the cost of NOT expanding Medicaid would be enormous to the private sector, said Amy Baker, coordinator of the Legislative Office of Economic and Demographic Research.
That’s because the billions of dollars of federal aid that would come into Florida over the next 10 years to cover an estimated one million of the uninsured under Medicaid would not be available. Meanwhile, the state’s businesses would be having to comply with the parts of the Affordable Care Act that have nothing to do with Medicaid.
“Expansion helps… by mitigating the effects of the mandatory provisions of the law,” Baker said.
The Senate committee’s numbers man, Orlando-area Republican David Simmons, told Baker that her numbers “make sense.” He had already figured out that the state’s employers would be hit if Florida doesn’t accept the federal funds that are being offered, he said.
“The burden on employers if we do NOT do Medicaid expansion is going to be significant,” he said.
Baker estimated that Florida would lose between $6 billion and $12 billion a year over the next 10 years if it says no to Medicaid expansion. That’s because the expansion is the only part of the Affordable Care Act that is voluntary.
The mandatory parts – that individuals and large businesses carry insurance or pay a penalty – will take effect regardless of the Legislature’s decision on Medicaid, she said. Meanwhile, almost one million low-income people who would have been covered by the new federal funds would remain uninsured, she said.
Currently Florida has just over four million uninsured, Baker said - about 21.4 percent. Under the health law’s provisions, counting Medicaid expansion, that will be cut to under 10 percent, she said.
The newly-covered Medicaid population would be those with incomes of 138 percent of the federal poverty level or less – about $15,000 for an individual. Most of those who would be brought into the program are adults who currently don’t qualify because they don’t have young children at home, Baker said.
Through their questions, some members of both committees indicated they were skeptical of the conclusions. Baker acknowledged there are a number of outcomes that can be forecast, depending on the assumptions used in economic modeling. She said she hopes to have more information by Thursday.
State Sen. Joe Negron, who chaired the joint session, indicated that he agrees with those who favor expanding Medicaid.
“In the end, the issues’s going to come down to weighing values, of having some form of insurance coverage available” for the uninsured, he said.
To those who predict calamity, he said, “Let’s not underestimate the human spirit.” Medicaid expansion may or may not be a good idea, he said, but it would be better to have 7 percent of Floridians uninsured than 21 percent.
Baker's slides are available online.
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