Last week's report from the Congressional Budget Office was a barnburner for the Affordable Care Act, predicting that Obamacare was set to deliver insurance to more people, with lower premiums and more savings for the government than all of their previous prediction. But that's not all. The Center on Budget and Policy Priorities digs a little deeper into the report, and discovers that the CBO says Medicaid expansion is an even better deal for states than originally predicted.
CBO has sharply lowered its estimates of the costs to states of adopting the Medicaid expansion.Now the CBO is projecting fewer people—who were eligible but not enrolled for Medicaid before health reform—will enroll in it now. That's because of a variety of factors: some will just refuse to sign up, but some will become eligible for private coverage. Because of that increasing flux in the population that has always been eligible for Medicaid, CBO now expects fewer of them to enroll, and thus expects states to spend less over the next decade than it previously assumed.
- CBO now estimates that the federal government will, on average, pick up more than 95 percent of the total cost of the Medicaid expansion and other health reform-related costs in Medicaid and the Children’s Health Insurance Program (CHIP) over the next ten years (2015-2024).
- States will spend only 1.6 percent more on Medicaid and CHIP due to health reform than they would have spent without health reform (see Figure 1). That’s about one-third less than CBO projected in February. And the 1.6 percent figure is before counting the state savings that the Medicaid expansion will produce in state expenditures for services such as mental health and substance abuse treatment provided to the uninsured.
Expansion states are saving money by taking the expansion. They're no longer having to pay hospitals and other providers for the care they are providing that isn't covered by private insurance or Medicaid. And none of the states that is rejecting the expansion is going to save money over the next decade because of it.
So as many as 17,000 people could die prematurely and unnecessarily this year, and next year, and the next, because states aren't willing to spend 1.6 percent more on Medicaid and CHIP. Purely out of political spite.