Study: Medicaid expansion would bring economic benefits
The Daily Reflector
Wednesday, June 26, 2019
Expanding Medicaid now in North Carolina would soon create more than 37,000 jobs and insure approximately 365,000 more people across the state, according to a county-by-county analysis released today by experts who’ve been studying the issue since 2014.
Locally, expansion would add 537 jobs and $114 million to Pitt County’s economy by 2022, according to the study conducted by The Center for Health Policy Research at George Washington University and funded by the Kate B. Reynolds Charitable Trust and Cone Health Foundation, both based in North Carolina.
More than 13,000 people here would receive health insurance, which means more health care jobs, according to the authors of the report. Salaries and related revenue would be pumped back into other sectors of the economy, from the real estate market to retail and service sectors.
The state General Assembly currently is considering a budget that includes no provision for Medicaid expansion. Democratic Gov. Roy Cooper, who has been pushing for expansion, likely will veto the budget and force a showdown with Republican legislative leaders.
GOP leaders cannot override the veto without the votes of at least seven Democrats in the House of Representative and one Democrat in the Senate.
Senate Leader Phil Berger disputes reports that expansion will boost the economy and provide health care to people in need and discouraged residents in a recent op-ed from joining the bandwagon.
“A full accounting of the facts leads to the inescapable conclusion that expanding Medicaid would be a mistake that not only will fail to solve the problems its proponents claim it solves, but will create new problems and rekindle problems that have just recently been put to rest — such as Medicaid cost overruns and yearly budget deficits,” Berger said in the piece distributed by email Monday.
Authors of the study, however, said North Carolinians are already paying for Medicaid expansion in 36 other states without reaping the benefits of those federal tax dollars. North Carolinians are about twice as likely to be uninsured as people neighboring states like West Virginia and Kentucky, both of which expanded Medicaid, the study said.
“Medicaid expansion is a job creator and can extend health coverage to thousands of previously uninsured North Carolinians who are falling through the gaps in our current system,” said Susan Shumaker, president of Greensboro-based Cone Health Foundation. “States that have already expanded Medicaid are better equipped to tackle critical health care concerns like opioid addiction and infant mortality rates — issues that need to be addressed here at home in North Carolina.”
Medicaid in North Carolina currently covers parents with incomes up to 42 percent of the poverty line. It generally does not cover adults without dependent children and does not cover most non-elderly, non-disabled adults without dependent children, regardless of their incomes. Expansion would raise the income criteria to 138 percent of the poverty line for all adults 19 to 64.
Because more low-income people will receive health insurance, increasing health care access across the state, the benefits will be broadly dispersed, the report said, producing economic gains in all 100 counties. Almost half the job gains — 17,900 jobs by 2022 — will occur in Buncombe, Durham, Forsyth, Guilford, Mecklenburg and Wake counties, while the other 19,200 jobs will be distributed across the rest of the state, including rural areas.
Slightly more than half of the job growth (20,600 jobs) would be in the health care field, according to the report, which updates an analysis released in December 2014. The other 16,600 jobs created would be in other fields such as construction, retail sales, professional and management services, etc.
“Although Medicaid funds would first flow to health care providers, they would then ripple out into other parts of the economy as staff employed in health and other fields purchase food, pay their rent and mortgages, and make other consumer purchases,” the study said. “The economic growth would increase North Carolina’s tax base and ultimately increase both state and county tax revenues.”
North Carolina currently funds about 33 percent of the total cost for services for more than 1.7 million Medicaid enrollees. The state would pay 10 percent of the cost for those insured under expansion, the report said.
Berger argues that vast majority of those who would become eligible for coverage under Medicaid expansion are able-bodied adults, and he said there is no guarantee that the federal government will continue to pay 90 percent of the cost of expansion.
“What will the state do when the federal government changes the rules and pays less than 90 percent? In fact, the same thing just happened with the children’s health program. The federal government changed its match rate, blowing a $140 million hole in our budget and forcing the state to come up with the additional funds to continue the program,” he said.