Experts Project A Net Economic Benefit To Expanding Medicaid Coverage In Nevada

CBPP: From 2014 - 2022, “The Additional Cost To The States Represents A 2.8 Percent Increase In What They Would Have Spent On Medicaid.” According to the Center for Budget and Policy Priorities:

The Congressional Budget Office (CBO) estimates that the Medicaid expansion will add very little to what states would have spent on Medicaid without health reform, while providing health coverage to 17 million more low-income adults and children.  In addition, the Medicaid expansion will reduce state and local government costs for uncompensated care and other services they provide to the uninsured, which will offset at least some -- and in a number of states, possibly all or more than all -- of the modest increase in state Medicaid costs.  Expanding Medicaid is thus a very favorable financial deal for states.

• CBO estimates show that the federal government will bear nearly 93 percent of the costs of the Medicaid expansion over its first nine years (2014-2022).  The federal government will pick up 100 percent of the cost of covering people made newly eligible for Medicaid for the first three years (2014-2016) and no less than 90 percent on a permanent basis.
• The additional cost to the states represents a 2.8 percent increase in what they would have spent on Medicaid from 2014 to 2022 in the absence of health reform, the CBO estimates indicate.
• This 2.8 percent figure significantly overstates the net impact on state budgets because it does not reflect the savings that state and local governments will realize in other health care spending for the uninsured.  The Urban Institute has estimated that overall state savings in these areas will total between $26 and $52 billion from 2014 through 2019.  The Lewin Group estimates state and local government savings of $101 billion in uncompensated care.

Other independent analyses show similar or even more favorable results for states.  An Urban Institute analysis finds that state Medicaid expenditures would likely increase by 1.4 percent over what states would otherwise spend on the program from 2014 through 2019, before taking offsetting savings in uncompensated care and other health services into account, while the Lewin Group estimates an increase in state Medicaid expenditures of 1.1 percent over that period.  These estimates reflect the increased state costs for Medicaid but not the offsetting savings states will also secure in uncompensated care and other health services. [Center for Budget and Policy Priorities, 7/12/12, emphasis added]

Urban Institute: Fiscal Effects Of Expanding Medicaid Coverage Benefits Nevada. According to a study by the Urban Institute which determined the net economic benefits of expanding Medicaid coverage under two savings scenarios, Nevada could potentially save between $101 million and $443 million overall from 2014 - 2019:

[Urban Institute, July 2011]

CBPP: “Massachusetts Shows That Expanding Coverage Reduces Other Health Care Costs.” According to the Center for Budget and Policy Priorities:

Massachusetts Shows That Expanding Coverage Reduces Other Health Care Costs

Massachusetts' experience with its health reform efforts offers evidence that expanding coverage under a comprehensive health reform plan can lead to sizeable reductions in state costs for uncompensated care.

Massachusetts enacted legislation in 2006 to provide nearly universal health care coverage.  The legislation combined a Medicaid expansion with subsidies to help low- and moderate-income residents purchase insurance, an employer responsibility requirement, and a requirement for individuals to obtain coverage.  All of these also are core elements of the Affordable Care Act.

With the expansion of affordable health insurance options and the institution of an individual mandate, spending on uncompensated care decreased significantly in Massachusetts.  As part of its health reform effort, the state replaced its Uncompensated Care Pool (also known as “Free Care”) with the Health Safety Net, which provides financial support to public hospitals and community health centers that serve low-income residents who are uninsured or underinsured or who have significant medical needs.  In 2008, the first full year of health reform implementation, Health Safety Net payments were $252 million, or 38 percent, less than the previous year's Uncompensated Care Pool payments.

This reduction in uncompensated care costs coincided with a decline in the share of residents who are uninsured. Only 2.7 percent of residents were uninsured in 2009, compared to 5.7 percent in 2007. [CBPP, 3/28/12]

Expanding The Health Care Industry In Nevada “Would Mean 40,000 Jobs For Southern Nevada.” According to Robert Lang, a professor of urban affairs at UNLV, speaking to the Las Vegas Sun:

But Robert Lang, a professor of urban affairs at UNLV, sees the debate differently. He argues it's about jobs.

Las Vegas' health care industry is dramatically smaller than in other states, meaning we have fewer doctors, nurses and receptionists than would be expected.

Given our population's size, age and income, the health care industry should make up 18 percent of our overall economy. In Southern Nevada, it's about 12 percent, according to a study co-authored by Lang last year.

“There's a lot of medicine missing from Southern Nevada,” he said.

Expanding the health care industry to meet the national standard would mean 40,000 jobs for Southern Nevada.

[...]

But Lang said direct costs to Nevada should be weighed against the economic benefits. Economic diversification has been a priority of Sandoval's administration, and health care is identified as one of the seven industry sectors the state is trying to attract. The governor's economic development plan also identifies Nevada's “under-capacity health care system” as one of the state's liabilities.

Expanding Medicaid “might be a chance to put a lot of money in play,” Lang said.[Las Vegas Sun, 7/8/12, emphasis added]

Executive Director Of The Nevada State Medical Association: “For Every Dollar Of Medicaid Spent In Nevada, $3 Gets Circulated In The Economy.” According to the Las Vegas Sun:

Larry Matheis, executive director of the Nevada State Medical Association, which represents doctors, said that for every dollar of Medicaid spent in Nevada, $3 gets circulated in the economy.

“I'd think there would be a positive effect on the economy that comes from expansion of the Medicaid program,” said Matheis, who added his association hasn't taken a position on expanding the program. [Las Vegas Sun, 7/8/12, emphasis added]

Study: Expanding Medicaid Coverage Will Result In Higher Enrollment With Low Spending Increase

Kaiser Family Foundation: Nevada Will Have 61.7% Higher Enrollment For 2.9% Higher Spending With Expansion. According to a Kaiser Family Foundation study, Nevada will insure 61.7% more people for only 2.9% more cost than baseline estimates,  (Medicaid spending and enrollment would have been without the Affordable Care Act):

[Kaiser Family Foundation, accessed 7/17/12]

Expanding Medicaid Coverage Will Benefit Nevada Women

Center for American Progress: Almost Two-Thirds Of Those Eligible For The Expanded Medicaid Program Nationally Will Be Women. According to the Center for American Progress:

Women make up a disproportionately high share of Medicaid recipients for three reasons: the traditional categorical eligibility requirements (such as being pregnant or a parent), women's longer lifespans, and the fact that women are more likely than men to be poor. Indeed, women currently constitute 68 percent of all adult Medicaid enrollees.

Many more men will be able to join Medicaid once eligibility is determined solely by income level. But of the approximately 15 million adults eligible for coverage under the Medicaid expansion, around 10 million of them--or two-thirds of the expanded Medicaid population--are nonelderly women.

Because poor women who are pregnant or parenting already qualify for Medicaid in many instances, most of the women living under the poverty level who qualify for the expansion do not have children. But many of those whose incomes are between 100 percent and 138 percent of the federal poverty level likely do. In addition, many of the women who qualify for the expansion are among the working poor--maids, waitresses, and home health aides whose jobs do not offer benefits and who earn too much to currently qualify for Medicaid but too little to purchase private insurance on their own. [Center for American Progress, 7/11/12, emphasis added]

Kaiser Family Foundation: 55% Of Currently Uninsured Nevada Women Would Be Potentially Eligible For Medicaid In 2014. According to the Kaiser Family Foundation, 25% of women in Nevada are uninsured, and 55% of those uninsured women would be eligible for Medicaid due to the Affordable Care Act starting in 2014.

[Kaiser Family Foundation, January 2012]

Nevada Medicaid Enrollment In 2008 Was Almost 60% Female. According to the Kaiser Family Foundation:

[Kaiser Family Foundation, accessed 7/17/12]

The Las Vegas Review-Journal Editorials Ignored The Benefits Of Expanded Medicaid Coverage, Only Discussed Cost

Review-Journal: “We Know That, Five Years From Now, Nevada Would Have To Come Up With Millions More Tax Dollars To Keep The Enrollment Expansion Intact.” From the Las Vegas Review-Journal:

Already, more than 308,000 Nevadans are covered by Medicaid, and nearly 50,000 more people are expected to join in the next biennium at a cost of $30 million per year. If the state chooses to participate in the ObamaCare expansion, Medicaid would take on an estimated 72,000 people who earn less than $14,400 per year, 133 percent of the federal poverty level.

We don't yet know the costs that would be incurred. We do know that Washington has a history of underestimating the price of entitlement growth. We know that, five years from now, Nevada would have to come up with millions more tax dollars to keep the enrollment expansion intact. And we know that once such a program is expanded into the middle class, it will be politically impossible to roll it back. [Las Vegas Review Journal, 7/11/12]

Review-Journal: “At A Minimum, Nevada Would Eventually Have To Come Up With Many Millions More Dollars To Keep The Expansion Intact.” From the Las Vegas Review-Journal:

More than 308,000 Nevadans are covered by Medicaid, and nearly 50,000 more people are expected to join in the next biennium, costing an additional $30 million per year. If the state participates in the ObamaCare expansion, Medicaid would take on an estimated 72,000 more beneficiaries. At a minimum, Nevada would eventually have to come up with many millions more dollars to keep the expansion intact. [Las Vegas Review Journal, 7/16/12]