Thursday, May 22, 2014

GOP and demos told us it would be FREE. They lied to us. Again!----------Medicaid Expansion Too Good to Be True

Medicaid Expansion Too Good to Be True | Cato Institute
But even with the federal government picking up 90 percent of the cost, Michigan taxpayers are not completely off the hook for state taxes.
Ten percent of a very big number is still a very big number.
In fact, over the next 10 years, it is estimated the Medicaid expansion will cost Michigan taxpayers $2.25 billion.
Even those estimates significantly underestimate the cost because they ignore a second category of recipients likely to be added to the Medicaid rolls if this expansion moves forward, what the Robert Wood Johnson Foundation has dubbed “the woodwork effect.”
As the Medicaid expansion moves forward, thousands of Michigan residents will discover that they are eligible for Medicaid.
Some of these people will be uninsured, but others will either be paying for insurance themselves or receiving it from their employer.
Now some will sign up for Medicaid.
In fact, it has been estimated that 202,000 people, roughly 37 percent of the 547,000 new Medicaid recipients enrolled under the expansion, would be “coming out of the woodwork.”
This group is not eligible for the 90/10 match, but is covered under the old formula, for which Michigan is responsible for nearly 34 percent of the cost.
While there have been no reliable estimates for Michigan of the additional cost from “woodwork” recipients, it is safe to assume that the woodwork effect would significantly increase the total cost to Michigan taxpayers.
This comes at a time when Medicaid already consumes 21 percent of Michigan’s budget, more than education or transportation.
Of course, any estimate of state costs assumes that the federal government will keep its side of the bargain when it comes to future funding.
But with Washington facing an ongoing debt crisis, Medicaid funding will almost certainly be on the table.
.......It is also worth noting that the combination of the Medicaid expansion and the woodwork effect would mean that nearly a quarter of Michigan residents will be on Medicaid, a massive increase in dependency and government control over the health care system.

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