Health care reform costs shift to cash-strapped states (Medicaid rolls to swell under Commiecare™)

Business Insurance ^ | 5/26/10

[Libloather]

Health care reform costs shift to cash-strapped states
Posted On: May 26, 2010 12:45 PM CENTRAL

WASHINGTON (Reuters)—Now that U.S. health care reform is becoming a reality, states are sorting out how they will pay for two of the plan's major components that will rest largely on their shoulders at the same time they are pulling out of a long economic downturn.

A study released on Wednesday uncovered one bright spot for paying for Medicaid, the health care plan for the poor administered by the states and paid for with matching funds from the federal government.

Under the health care reforms championed by President Barack Obama, states generally will see their Medicaid costs rise mildly, while they are in line for more federal dollars, according to the study.

The plan made more people eligible for Medicaid, which should have driven states' costs higher. Congress, though, included a caveat for the federal government to reimburse the costs of all new enrollees by 100%.

The Kaiser Family Foundation study found that through 2019, the year when the U.S. government will pull back and reimburse 93% of the costs of those participants, federal spending on Medicaid will increase by at least $443.5 billion.

On the other hand, states will see an increase of only $21.1 billion. Other increased federal funding streams will draw down the amounts states have to put into Medicaid, as well, Kaiser found.

That means that under conservative estimates, Maine's Medicaid spending would decrease 1.5% and Colorado's would slip 0.5%, according to the study. Massachusetts and Vermont, which established their own health plans, would spend 2.1% and 0.6% less, respectively.

Medicaid rolls to swell

[kabar]

And this is good news?

[Lorianne]

Some of the States can’t wait to shift the costs onto the Feds in advance of the Fed Gov subsidies that are coming to low income people for health insurance.

Indiana Freezes Public Health Care Programs
http://www.gohealthinsurance.com/blog/coverage/entry/20100323

[Graybeard58]

Smoke and mirrors.

[caseinpoint]

Exactly. Victim: Instead of Perp A, Perp B is going to steal your wallet. As one of the victims, I’m thrilled. Does it really matter whether it comes from state or federal taxes, except as to which entity gets to keep raising taxes willy-nilly?

[Blood of Tyrants]

You know, there is nothing that forces the states to participate in Medicaid. They can simply tell the feds to keep to keep their money and to pound sand.

[Oceander]