Gov. Paul LePage has said “no” five times to an expansion of Medicaid under the Affordable Care Act. Still, a number of lawmakers are pushing ahead with renewed attempts to take advantage of an unprecedented offer from the federal government to expand health coverage to about 70,000 low-income Maine adults and assume the lion’s share of the costs.
The LePage administration consistently argues that expanding Medicaid exposes the state to too many financial risks that could upset a balanced state budget.
“If past is prologue, then expanding Medicaid to populations beyond Medicaid’s original priorities of the elderly, disabled, children, very low-income parents and pregnant women, giving free health insurance instead to able-bodied adults of working age, would be devastatingly more expensive than the estimates others would have you believe,” Health and Human Services Commissioner Mary Mayhew said April 30 in legislative testimony opposing four separate bills that propose expanding Medicaid.
Indeed, the assertion about “devastatingly more expensive” health care costs is based on Maine’s past experience expanding Medicaid to some of the same residents who would benefit from the expansion offered today through the Affordable Care Act. And it’s precisely what Maine has learned from that experience that should give the state the certainty it needs to expand.
When Maine started expanding coverage to low-income, childless adults in 2002, few states had any experience covering that population with Medicaid. States had little knowledge of their health care needs and how much it would cost to cover them. They had little knowledge of precisely how many low-income adults they could count among their populations. The result was plenty of surprise at the number of adults who enrolled, how quickly they enrolled, and how much their health care cost.
Today, Maine can look to about a decade of covering that population and be able to better gauge their health care needs and the cost to provide them. The state can now assess how large the population is (the state today also has the benefit of annually updated Census data with detailed socioeconomic information, something that didn’t exist in the early 2000s). And the state can look to the current expansion offer from the federal government and determine that it’s a good deal for the state.
Why? That’s precisely the approach a group of independent analysts took recently in concluding that Maine could expect a $26.7 million state budget savings in 2016 from expansion, with savings likely to continue even as the federal government’s contribution starts to drop.
Manatt Health Solutions, which performed the analysis for the Maine Health Access Foundation, based its calculations on Department of Health and Human Services figures on the costs of covering low-income childless adults and DHHS figures on childless adult enrollment in Medicaid.
For 2016, when the federal government would cover 100 percent of costs for adults without children (a figure that would later drop to 90 percent), Manatt found that Maine came out ahead due to a combination of savings from shifting expenses elsewhere in the state budget to Medicaid and new revenues the state would take in from hospitals treating newly covered patients.
Those savings would come from enrolling newly eligible residents in Medicaid who would otherwise qualify for services funded entirely or mostly with state funds. By shifting state spending for mental health services, breast and cervical cancer screening, and prescription drug assistance for older residents to Medicaid, the federal government effectively takes over the responsibility of paying for them.
The savings resulted despite the expense of covering tens of thousands of new enrollees, including low-income parents, whose costs the federal government will reimburse at a rate closer to 60, rather than 100 or 90, percent.
Medicaid expansion opponents continue to push the argument that expansion will be a budget buster for states and that enrollment in states that have opted to expand is shattering original projections. The bottom line? Maine has the experience most states don’t to craft more credible enrollment and cost projections that can keep surprises at bay.
The other bottom line? The objective of the Affordable Care Act is to insure more Americans so they can lead healthier, more financially secure lives. When did it become such a bad thing for people to take advantage of the health coverage available to them?
