As part of my doctorate in health policy and economics, I spent the last four years studying the impacts of the Affordable Care Act and specifically, Utah’s decision not to expand Medicaid. Several recent news articles have misrepresented the facts on the impact of Medicaid expansion in other states, particularly related to the health and economic benefits of expansion. Here are a few checks:
Since 2014, Utahns have paid taxes to fund Medicaid expansion in other states. To be exact, every day Utah leaves $796,789 tax dollars on the table that does not come back to the Utah economy. The question is not whether states want to pay for the care of low-income Americans, but rather whether they also want those taxpayer dollars to return to Utah.
The returned tax dollars have the potential to contribute to the growth of the Utah economy due in part to what economists call the “multiplier effect,” the concept that a dollar entering the economy returns more than a dollar of economic activity. Medicaid expansion dollars fund the provision of health care, promote financial stability and increase employment in the health care sector. These effects are multiplied as those dollars bolster health care businesses and pay wages to employees who support the local economy through their everyday expenses.
Studies report that Medicaid expansion supported 31,075 additional jobs in Colorado, 40,000 in Kentucky and 39,000 in Michigan, enough to offset the costs of Michigan’s expansion through 2021. Contrary to common rhetoric, adults with disabilities in expansion states are less likely to be unemployed compared to adults with disabilities in non-expansion states. Medicaid expansion also reduces state spending on health services provided through correctional health and state mental health programs, which reduced spending on such programs in Michigan by $235 million.
Numerous studies have demonstrated that states that expanded Medicaid under the ACA realized budget savings, revenue gains and overall economic growth. Evidence also shows no significant reductions in spending on education, transportation or other states programs. In Louisiana, expansion saved the state $199 million.
Utah is responsible for 10 percent of the costs of covering 155,000 low-income Utahns. Proposition 3 was designed with a built-in funding mechanism: a 0.15 percentage point tax increase, or.15 cents on $100 (of non-food items). In the ballot language, the tax is described as a 3% percent increase. A 3 percent increase does not mean the tax rate increases by 3 percentage points, but rather that it increases by 3 percent of its’ original value, or 0.15 percentage points.
Claims that the Legislature has already passed an expansion are misleading, as their limited expansion wouldn’t cover as many people and is extremely likely to be rejected by the Trump administration, which has declined similar proposals from two other states.
The majority of those who fall in in the coverage gap work part or full time but simply do not have a way to access affordable coverage. They make too much to qualify for existing Medicaid but not enough to get coverage through the state’s private Marketplace.
The documented benefits of expansion are innumerable; from fewer personal bankruptcies, improved cancer screening, prescription drug adherence, access to surgical care, improved chronic disease management, depression outcomes, self-reported health and reductions in mortality.
Evidence demonstrates that Medicaid expansion is a viable pathway to provide coverage for uninsured Americans, support the Utah economy, and improve population health.
There are many disheartening facts about the U.S. health care system, but Medicaid is one of the bright spots that also happens to provide a safety net one out of every five of your neighbors relies on.
Sarah Gordon
Sarah Gordon is a visiting scholar at the University of Utah’s Department of Population Health Sciences and in the final year of study for a doctorate in health economics and policy at Brown University’s School of Public Health.The views, information, or opinions expressed in the commentary solely belong to the author and do not necessarily reflect those of the University of Utah.