Viewpoint: Benefits from Medicaid

BY ELIZABETH LAMOSTE

Published January 13, 2013

Expanding Medicaid benefits not only helps the uninsured, but also benefits individuals with private health insurance, hospitals and the state economy. The Affordable Care Act, put into place by President Barack Obama, gives states the opportunity to expand Medicaid eligibility to cover all non-elderly citizens and eligible immigrants up to 138 percent of the Federal Poverty Line. Michigan Gov. Rick Snyder has the power and obligation to decide whether Michigan should participate in Medicaid expansion. Now is the time for Snyder to decide that Michigan will take advantage of this valuable opportunity.

Medicaid expansion benefits Michigan’s economy. The Affordable Care Act provides that the federal government will pay for 100 percent of the cost of Medicaid expansion between 2014 and 2017, ultimately paying for 90 percent of the cost in the following years. Analysts at the Center for Healthcare Research and Transformation project that Michigan can reap up to $1 billion in savings in the next 10 years due to this expansion. Medicaid expansion is also projected to bring more than $30 billion into Michigan’s economy between 2014 and 2023.

Medicaid expansion benefits those who need health insurance. According to the Center for Budget and Policy Priorities, there are about 676,000 uninsured Michigan citizens who would be eligible for Medicaid if Michigan chooses to participate in the program. Medicaid expansion will give these uninsured people a chance to access health care services that will improve their health and well-being.

Medicaid expansion benefits employers and individuals with private health insurance. If you’re an employer or individual who purchases private health insurance, part of your costs come from uncompensated care that hospitals provide to the uninsured by law. If we reduce the number of uninsured, we reduce the amount of uncompensated care expenses that get passed onto those with private health insurance. The Center for Healthcare Research and Transformation projects statewide savings between $640 and $985 million over the next 10 years for those who purchase health insurance because of Medicaid expansion.

Medicaid expansion benefits hospitals. Currently, hospitals that treat a lot of uninsured patients receive extra compensation known as disproportionate share payments. The federal government will reduce payments to hospitals across the nation between 2014 and 2020 because it expects fewer people will be uninsured. If we fail to expand Medicaid, Michigan hospitals will most likely be in a nasty bind — their payments will go down and they may face an increase in uncompensated care expenses.

Snyder believes that “to build a stronger Michigan, we must build a healthier Michigan.” I agree wholeheartedly. Let’s get started by expanding Medicaid and participating in this valuable project.

Elizabeth Lamoste is a Law School student.