Wednesday, March 12, 2014
While a $925,000 report commissioned by the LePage administration concludes that Maine should not expand Medicaid, critics said the numbers in the report tell a different story.
Mitchell Stein, public policy director for the health advocacy group Consumers for Affordable Health Care, noted that the Alexander Group’s report shows that providing an additional 70,000 to 125,000 Mainers with health insurance would increase the state’s General Fund budget by 3 percent.
Gov. Paul LePage released the report from consultant Gary Alexander on Friday. Democrats in the Legislature have argued in favor of expanding Medicaid under the Affordable Care Act.
A U.S. Supreme Court decision in 2012, while upholding much of the Affordable Care Act, allowed states to opt out of Medicaid expansion. LePage’s supporters said the report released Friday proves that the expansion would be too costly.
But Stein said that if the state doesn’t expand its Medicaid program, called MaineCare, federal dollars set aside for Maine will go instead to other states. The expansion would be paid for with 100 percent federal money in the first three years, and 90 percent in subsequent years.
But Rep. Alex Willette, R-Mapleton, said the study shows that the state would shoulder a larger burden than expected.
“Both the Department of Health and Human Services and the Legislature’s nonpartisan budget office have projected that welfare expansion will cost the state millions over the long term,” he said. “This study provides an even deeper analysis and suggests that the cost may be even greater than we originally thought.”
Among the report’s findings:
n The cost of the MaineCare program, which is funded with a blend of federal and state dollars, will climb from $2.7 billion in 2013-14 to $4.6 billion in 2023-24 if the state does not expand it. The cost will climb to $5.5 billion if the state does approve expansion.
That means an extra $926 million in Medicaid funding in 2023-24, of which the federal government would pay $801 million.
n Enrollment in MaineCare would balloon by nearly 100,000 people in the first year, from the current total of about 320,000. That increase would be much more than the 70,000 estimated previously by expansion advocates. By 2023-24, the total increase would be 124,000.
To explain his higher projections, Alexander says employers would drop workers’ insurance and some individuals would drop private plans if they could get MaineCare benefits at little or no cost.
n The percentage of the state’s population on MaineCare will increase from 24.7 to 29 if the state does not expand Medicaid. The percentage will grow to 37.9 if the state does expand the program.
Sara Gagne-Holmes, executive director of Maine Equal Justice Partners, an advocacy group that favors expansion, said the report make dubious assumptions, including that poverty will continue to increase and that the federal government will keep reducing its financial contributions to the overall Medicaid program.
She said the report does not factor in savings from expanding Medicaid. For instance, some programs that are at least partly funded with state money, such as a program for low-income people who have HIV, would be funded entirely by the MaineCare expansion.
She said Maine Equal Justice Partners has identified at least $5.9 million in such savings, and she believes there are more such examples. “I don’t see any savings calculations in the report,” Gagne-Holmes said.
Alexander’s report also says that the quality of health care under Medicaid is substandard relative to private insurance, and so enrolling more people in MaineCare may not improve the state’s health.
“Expanding MaineCare does not address any of these quality-of-care issues; moreover, expansion may leave those losing commercial coverage with no other choice but to enroll in MaineCare,” Alexander wrote.
Joe Lawlor can be contacted at 791-6376 or at: