Medicaid expansion: No downside

Contact: Jan Hudson or Gilda Z. Jacobs at 517.487. 5436
Feb. 5, 2013

Michigan has option to cover half-million very low-income uninsured
Action would offer health care and mental health treatment without new state dollars

[LANSING, Mich.] An estimated 400,000 to 600,000 uninsured people in Michigan would gain health care benefits paid from Michigan’s share of federal health care funds if the state expands Medicaid, a report released today from the Michigan League for Public Policy concludes.

Gov. Rick Snyder is likely to signal his intentions on whether to expand Medicaid as outlined by the Affordable Care Act when he releases his budget Thursday. The Michigan Legislature would have to appropriate the funds. The option offers health care coverage to very low-income people under 133 percent of poverty — those earning $15,000 a year or less for a single person.

“There really is no downside,” said Gilda Z. Jacobs, president & CEO of the Michigan League for Public Policy. “Expanding health care coverage to the very low-income uninsured is simply the right thing to do. It will help single adults who don’t earn enough to afford insurance as well as low-income parents whose children are already covered under Medicaid. It will stop unnecessary and expensive treatment in emergency rooms. It will help employers who will benefit from a healthier workforce. It will keep our share of the federal dollars flowing to providers in Michigan rather than going to other states.”

If Michigan turns down this option, it will lose about $2 billion in federal funds each year and throw many people into a “coverage chasm” where they earn too much for Medicaid but earn too little for supplements to purchase health insurance under the Affordable Care Act. Research by the nonpartisan House and Senate Fiscal agencies show no additional state dollars needed – and even some state savings –  over the next decade.

Key points in Medicaid Expansion: Saved from the Cliff or into the Chasm? are:

*Providers support the expansion and primary care doctors say they will take on new patients.
*Expansion would result in less emergency room care and more preventive care.
*Those newly eligible for Medicaid, an estimated 400,000 to 600,000, would also become eligible for comprehensive mental health services.
*Businesses would benefit from a healthier workforce and those businesses offering health insurance would no longer subsidize those without.
*No new state funds will be required and there will be cost savings in the first decade.
*This will help very low income people (up to 133% of the poverty level or about $15,000 a year or less), particularly adults without children.
*Medicaid expansion will not add to the federal deficit.
*New polling shows the public supports the expansion of coverage with available federal dollars.

“Any way you look at this, it’s a win-win for Michigan, and an opportunity to make our state healthier and expand needed mental health services,” Jacobs said. “Turning down available dollars to pay for preventive health services would hurt people, hurt employers, hurt doctors, hospitals and other providers and it would turn back the hands of time on health care in our state.”

The report is available at www.mlpp.org.

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The Michigan League for Public Policy, formerly the Michigan League for Human Services, is a nonprofit, nonpartisan research and advocacy organization working for economic opportunity for all.