Alabama could save 210 lives in 2016 by expanding Medicaid, White House study says

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If Alabama expanded its Medicaid program, it would boost federal spending in the state by $1.24 billion in 2016 and save the lives of 210 people who otherwise would die, according to a study released by the White House Thursday.

In "Missed Opportunities: The Consequences of State Decisions Not to Expand Medicaid," the report by the White House Council of Advisers draws on previously published research. It is the latest attempt by the Obama administration to persuade Alabama and 21 other holdout states to accept the deal under the Affordable Care Act to expand the federal-state health insurance program for the poor.

It comes on the heels of a report released earlier this week by the Department of Health and Human Services detailing a number of statistics related to health insurance sold by private companies on the federal health care exchange.

The White House report on Medicaid argues that Alabama and other state would see both improved finances and health of its citizens by expanding to cover residents making up to 138 percent of the federal poverty line.

"These additional Federal dollars will increase the overall standard of living for States' citizens by increasing low-income individuals' ability to access care, relieving cash-strapped families of high out-of-pocket costs, and reducing uncompensated care," the report states.

Perhaps most provocative is the projection that 5,180 people, including 210 in Alabama, would not die next year if every state expanded Medicaid. The report's authors came up with those figures by extrapolating from the results of two previous studies.

The first found that the mortality rate fell by 2.9 percent in Massachusetts after that state passed a law similar health reform law under then-Gov. Mitt Romney. The study compared a group of counties to demographically similar counties in other states.

Another study found a 6.1 percent mortality drop in after pre-Obamacare Medicaid expansions in Arizona, New York and Maine, compared with other states that did not expand.

"This evidence base justifies confidence that State Medicaid expansions under the Affordable Care Act will reduce mortality," the White House study states.

Bentley's mind not changed

Alabama Gov. Robert Bentley has suggested in the past that he would be open to accepting additional Medicaid funds under a waiver that required recipients to work for the benefits. But he has not sought a waiver, and the Obama administration has rejected similar proposals from other states.

Jennifer Ardis, a spokeswoman for Bentley, said the governor remains firm in his opposition to a straight-up Medicaid expansion.

"The governor's position on Medicaid has not changed," she said via email. "His focus is working to reform the current system we have in place, making it more effective and efficient for those currently enrolled."

Republicans in the Legislature also remain steadfast. In April, the Republican-controlled state Senate passed a resolution opposing Medicaid expansion.

The Alabama Policy Institute, a conservative think tank based in Birmingham, noted that Medicaid is the largest expenditure in the state's General Fund budget and has experienced rapid growth.

"Expansion dollars could not be used for any current costs, only the cost of new enrollees. Expansion would add hundreds of thousands of Alabamians to the program, an estimated 75 percent of which would be able-bodied adults without dependents, with the state taking on 10 percent of the tab, not including the administrative costs," spokesman Marshall Yates said in an email. "The experience of other states has shown again and again that expansion is more costly than advertised while states are provided little to no meaningful flexibility by the federal government."

The study points to findings by researchers at the left-leaning Urban Institute that states would save more on the costs of compensating hospitals for the treatment of nonpaying, uninsured patients than they the local match of the Medicaid expansion. Under the law, the federal government picks up 100 percent of the expansion costs in 2016. After that, the federal share gradually shrinks until it its 90 percent.

In Alabama, according to the White House study, expansion would save the state $190 million in 2016 for uncompensated care of the uninsured.

"Increased demand is likely currently accelerating the recovery from the Great Recession in States that have already expanded their Medicaid programs," the White House study states. "Looking ahead, State Medicaid expansions will safeguard access to health care and cushion household budgets in the face of the job and income losses that occur during future recessions, helping reduce the severity of future downturns while better protecting families from their consequences."

But the study warned that the window for dramatic economic gains may be closer because the economy is closer to full employment than it was when the Affordable Care Act took effect. Fewer people unemployed means that additional federal spending will create fewer jobs, the study contends.

A 2013 study by the University of Alabama, commissioned by the Alabama Hospital Association, forecast significant economic gains. Later, an analysis by Troy University's libertarian-minded Manuel H. Johnson Center for the Political Economy challenged those conclusions.

Health gains projected

Doug Hoffman, a former Birmingham hospital administrator who has tirelessly advocated for a Medicaid expansion, noted that people earning between the federal poverty line and the point where subsidized private insurance kicks in cannot get Medicaid coverage and cannot afford private insurance. Various estimates have been made about the size of that group, but the White House study pegs the number at 177,000.

"As a navigator for the Affordable Care Act, I was meeting with people daily who fell into this Medicaid gap. ... A lot of these people have chronic conditions," Hoffman said. "Some of these illnesses catch up with them, and they have to pay case to a doc-in-the-box."

He said Alabama would benefit economically from the additional federal spending and also from poor people having additional money for food, clothing and other items. He improved medical care also would create a lead to a healthier workforce.

Hoffman said the state never would turn down matching funds for highways, despite much less favorable terms than a 90-10 split.

"What do we get in return? We get much better care results," he said.

The White House study predicts a number of other health benefits in 2016 if Alabama expanded Medicaid, including:
•An increase of 25,800 cholesterol screenings.

•An increase of 7,000 mammograms.


•An increase of 10,700 pap smears.


•An increase of 42,000 people who have a regular source of clinical care.


•An increase of 20,000 people receiving "all needed" care.


•An increase of 478,000 physician visits.


•A decrease of 16,000 people experiencing depression.


•An increase of 24,000 people reporting that they are in good, very good or excellent health.

The White House study predicts a number of other health benefits in 2016 if Alabama expanded Medicaid, including:
•The study also projects financial benefits for individuals:


•A reduction of 7,900 people with catastrophic out-of-pocket expenses.


•A reduction of 25,200 people borrowing money to pay bills or skipping payments because of medical bills.

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