Research Shows Extending Coverage Could Save State Money
In the wake of President Obama’s re-election, uncertainty about implementation of the Patient Protection and Affordable Care Act has disappeared and the State of Florida now faces important decisions regarding its Medicaid program.
Among the most critical of these is whether or not to exercise its option to expand Medicaid coverage to Florida residents with incomes at or below of 133% of the Federal Poverty Level ($25,390 for a family of three).
A recent study by researchers at the Health Policy Institute at Georgetown University reports that Florida could institute this expansion of Medicaid and provide coverage to an estimate 800,000-1.3 million uninsured Floridians without assuming any new net costs.
The findings are reported in an education briefing released November 15 by Joan Alker, Jack Hoadley and Wesley Prater of the Georgetown Health Policy Institute. The research was conducted as part of a series of educational briefings on Florida’s Medicaid program that were commissioned and funded by the Jessie Ball duPont Fund and the Winter Park Health Foundation (WPHF).
Moreover, the researchers estimate that the state could save as much as $100 million a year because expanded Medicaid coverage will reduce the financial costs of other state-supported safety net programs and new coverage is financed almost entirely by the federal government.
“Our study found that the state can actually save money while ensuring that a million Floridians can get the health coverage they desperately need. And this decision affects all Floridians as Florida’s hospitals will be put in jeopardy if the state does not move forward,” said Joan Alker, Research Associate Professor at Georgetown University’s Health Policy Institute.
Researchers Alker and Hoadley have studied Florida’s Medicaid program since 2004. The most recent brief examines the impact of the June 2012 ruling by the U.S. Supreme Court on the constitutionality of the Affordable Care Act, the major health care reform law passed by Congress in 2010.
The authors note that the Supreme Court ruling gave states the choice of whether or not to extend Medicaid coverage to individuals with incomes at or below 133% of the Federal Poverty Level (FPL).
In most cases, Florida currently provides no Medicaid coverage to childless adults and covers only those parents with incomes at or below 20% FPL — $3,813 for a family of three.
Even with the introduction of health exchanges called for in the Affordable Care Act, tens of thousands of Floridians will be left without insurance or Medicaid coverage starting in 2014 if the state does not accept the option to expand coverage.
Florida policymakers have long expressed concerns about the costs of the state’s Medicaid program in general and, in particular, the costs that may be associated with expanding coverage.
The researchers, however, report that a combination of increased federal funding and state savings in current spending on a number of safety net programs would allow the state to expand Medicaid coverage and still achieve a savings of perhaps as much as $100 million a year.
A copy of the complete brief is available at hpi.georgetown.edu/floridamedicaid, www.dupontfund.org and www.wphf.org.
The Jessie Ball duPont Fund makes grants to more than 330 eligible organizations identified by Mrs. duPont in her will. The fund has assets of more than $315 million and has awarded $250 million in grants since 1977.
The Winter Park Health Foundation is a private, not-for-profit organization supporting programs that improve the health of youth, older adults and the community at large. It also conducts research and provides education on health issues affecting these groups.
Click here to view the brief on the WPHF website.