A state analysis of a potential Medicaid expansion in Georgia finds that the move would cost up to $148 million in fiscal 2020 and would cover up to 526,000 people.
The “fiscal note,” requested by Georgia House Democrats, comes in the wake of a governor’s race in which the two major candidates split on the issue. Gov. Brian Kemp, the Republican who won the election, opposed Medicaid expansion as outlined by the Affordable Care Act. Democratic candidate Stacey Abrams strongly supported expansion and campaigned on the issue.
The analysis, dated Jan. 18, is signed by Greg S. Griffin, state auditor, and Kelly Farr, director of the state Office of Planning and Budget. It factors in savings to state agencies and revenue gains in order to estimate the net cost to Georgia of expansion.
The letter is addressed to House Minority Leader Bob Trammell (D-Luthersville), who told GHN on Tuesday, “Medicaid expansion remains the best investment Georgia can make in health care spending. Putting an insurance card in the pocket of nearly 500,000 Georgians for a net cost to the state of $150 million in FY 2020 should be first priority for this General Assembly. The fiscal note shows what 36 other states have already figured out. It’s time to expand Medicaid.”
The estimates for the cost and impact of expansion increase to up to $213 million in fiscal 2022, covering as many as 598,000 people, according to the fiscal note.
Kemp has proposed $1 million to study the idea of a Medicaid “waiver,” which has yet to be defined for the state. His press office could not be reached late Tuesday on the fiscal note.
The waiver ideas potentially under consideration would almost certainly extend insurance to fewer Georgians than standard Medicaid expansion.
Kemp told the Times Journal last week that “we’ve also got to use innovation and waivers to Obamacare to free up the private sector market and have reinsurance programs that help protect those that have a pre-existing condition.
“Even if you expanded [Medicaid], there’s not enough providers out there to provide the service for it,” said Kemp, according to the Times Journal, which is the parent company of the Rome News-Tribune.
“If you’re making the argument which was made to expand Medicaid to get federal money, even though it’s going to cost hundreds and hundreds and hundreds and hundreds of millions of dollars of state dollars, not $150 to $200 million like my opponent said, all that money’s gonna come right here in the metro [Atlanta] area. It’s not going to help the rural people because you don’t have the providers out there to provide the service. So you’re expanding a broken program . . . They want to give able-bodied people free health care. I want to put them to work and lower the private sector cost.”
Former Gov. Nathan Deal, who finished his term last week, and Republican leaders in the state Legislature have opposed expansion for years, citing the cost to the state. Georgia, meanwhile, has continued to have one of the highest uninsured rates in the nation, at 13 percent.
Expanding coverage, meanwhile, has consistently polled well among Georgians. A year ago, an AJC poll found that 73 percent favored expansion, including 51 percent of Republicans.
An Urban Institute analysis last year said that in Georgia, state spending would increase by $246 million, or 6.3 percent, under Medicaid expansion, but “would be offset largely by savings in other areas, including uncompensated medical care for people who are currently uninsured.”
The new state estimate “is lower than the previous estimate and underlines the affordability of expansion for the state,” Laura Colbert of the advocacy group Georgians for a Healthy Future told GHN.
The analysis bases its estimates on a bill that would expand Medicaid to people – largely low-income adults – who earn up to 138 percent of the federal poverty level, which now is roughly $16,700 for an individual. The auditors also assume that the newly eligible would be placed into the care management organizations that deliver services to more than 1 million Georgians in Medicaid.
The enrollment estimates include new coverage for thousands who are currently uninsured; thousands of low-income people who are currently insured through an employer or the health insurance exchange; and those who are currently eligible for Medicaid but who are not enrolled.
The Georgia fiscal note takes into account that expansion would bring in $45.5 million to $59.2 million in additional revenue, including increased state income and state sales tax money.
State agency savings are estimated to be as high as $67.6 million in fiscal year 2020 and $68.1 million in fiscal year 2022.
The agencies expected to replace state funds with federal funds include the Department of Community Health, the Department of Public Health, the Department of Behavioral Health and Developmental Disabilities, and the Georgia Department of Corrections. The latter agency’s savings could be $17 million for inmate hospitalization costs.
Bill Custer, a health insurance expert at Georgia State University, said Tuesday that the cost of Medicaid expansion in other states has been less than projected.
Democratic lawmakers in the General Assembly are expected to rally around the new cost estimate during this year’s legislative session, which recently got under way.