A new study by the University of Missouri claims expanding Medicaid as part of the Affordable Care Act might actually pay for itself, at least as far as the state budget is concerned.
The study -- released by the Missouri Hospital Association -- says expanding Medicaid, health insurance for the poor, would cost the state $333 million from 2014 to 2020. During that time, the federal government would spend $8.3 billion on expanding the program.
At the same time, the expansion would provide coverage to an additional 160,000 people annually.
The report says the spending and coverage would generate 22,000 Missouri jobs during the period, including nursing, hospitals, payroll workers, and others. Taxes generated by those jobs, and other economic growth, might provide enough money to cover the state's share, the group argues.
"This report...provides the first glimpse that with the new economic activity created by the significant job creation, the state could generate more state revenue than is needed to fund the (expanded Medicaid) program," said MHA president Herb Kuhn.
The state legislature must decide if Missouri will expand eligibility for Medicaid, as anticipated in the Affordable Care Act. Some Republican lawmakers have balked, complaining the cost is too high.
Earlier this year the Supreme Court said the federal government could not cut off funding for existing Medicaid for states declining to take part in the expansion. That in effect made the expansion an option for states.
Hospitals are quite worried that Missouri will decline to participate in the expanded Medicaid program. The ACA pays for the expansion in part by cutting Medicare and Medicaid payments to hospitals and other providers for taking care of the uninsured.
"The ACA cuts hospital payments by nearly $3.5 billion in Missouri from 2013 to 2019," Kuhn said. Rural hospitals are particularly worried.
Expanded Medicaid is supposed to pick up some of that slack for the hospitals. If the program isn't expanded, hospitals may try to shift the burden to other patients, he said.