Study: Not expanding Medicaid could impact private costs

By Bobby Harrison/NEMS Daily Journal

JACKSON – A national health care expert said Friday a study indicates that the costs of health insurance premiums might increase in states that do not participate in the Medicaid expansion that is part of the federal Patient Protection and Affordable Care Act.
Judy Solomon, vice president of health policy at the Washington, D.C.-based Center on Budget and Policy Priorities, spoke in Jackson at the annual conference of the Mississippi Economic Policy Center.
Solomon cited an American Academy of Actuaries study that concluded the costs of private health insurance could rise in states that opt out of an opportunity to expand their Medicaid programs to cover those earning about $15,000 per year, or 138 percent of the federal poverty level.
Republican Gov. Phil Bryant has said Mississippi cannot afford to participate in the expansion even though the federal government will pay the bulk of the costs. A recent study by the University Research Center of the Institutions of Higher Learning has estimated the cumulative costs to Mississippi from 2014 to 2225 at $1 billion – but about half of that when factoring in the boost in state revenue the expansion will generate. During the same time period, the study concluded the federal government would provide more than $11 billion in Mississippi for the expansion.
Solomon cited the actuarial study as a possible unseen negative consequences for states that opt out of the expansion.
She said the actuarial study cited the fact that people between 100 percent and 138 percent of the federal poverty level can get private insurance with the aid of a government subsidy if the state does not expand Medicaid. She said those people, the study concluded, are likely to be less healthy, driving up the costs of private insurance. Plus, she said people without coverage continuing to go to the emergency room also will drive up the costs of private health insurance, especially since federal funds to offset the uncompensated care hospitals provide will be reduced.
The study also said that companies that employ more than 50 people in low-wage jobs also could be penalized in states that do not expand Medicaid. The study said the low-wage employees will be mandated to purchase private insurance with government subsides. And when they do that, their employers will be penalized under the law.
Whereas, if they are covered through Medicaid, the companies will not be penalized.
Ed Sivak, director of the Mississippi Economic Policy Center, pointed out that the governor and the Mississippi Economic Council in stops across the state Friday were touting the expansion of the health care economy as a way for the state to create additional jobs. Plus, they are saying that a healthy workforce is crucial to economic development.
“In a state where poor health is a deterrent to economic development, connecting more people to insurance will help create a healthier and more productive workforce,” Sivak said.
Whether the state expands or not, the new law will prevent Mississippi from requiring people to apply in person to be covered by Medicaid. Mississippi is the only state still requiring so-called “face-to-face” certification and re-certification for Medicaid coverage.
Currently, about 710,000 people – primarily poor pregnant women, poor children, certain groups of the elderly and the disabled – are covered by Medicaid in Mississippi.
Studies conclude the expansion would add about 300,000 people working in low-wage jobs.
bobby.harrison@journalinc.com