What would an Alabama Medicaid Expansion Look Like in 2022?

Birmingham Business Journal, Dec. 6, 2013

Alabama's share of the Medicaid expansion in 2022 would be less than the amount the state would pay to attract private businesses to the state, according to a report released Wednesday by the Commonwealth Fund.

The nonprofit health care organization's report looked at three future financial scenarios tied to the Medicaid expansion. All the estimated data is for the year 2022, when states participating in the expansion would have to cover 10 percent of the initiative.

Alabama is one of the states that has so far decided against the expansion. Gov. Robert Bentley in recent interviews with media has repeated his opposition to the expansion by stating, among other things, that he won't expand what he calls a broken system, and that growing enrollment for an entitlement program would impose an unsustainable financial burden on Alabama in the future. Bentley has also criticized findings by another recent study that projects the addition of thousands of jobs to Alabama should the state expand Medicaid.

According to Commonwealth's figures, Alabama's share of the expansion in 2022 would be $246 million, less than the $343 million the state is expected to provide in incentive payments to attract private businesses.

Should Alabama keep its course and all the other states expand Medicaid, its share of the general tax revenue collected by the federal government would be 0.8 percent. Alabama under that same scenario would also see a net loss of $943 million in federal funds.

Alabama's share of general tax collections and net loss of federal funds, however, won't be as steep as that of many states, including ones in the southeast. Alabama's neighbor Georgia, which has so far decided against an expansion, would see a 2.5 percent share of general tax revenue collected by the federal government and a net loss of $2.8 billion. Tennessee under no expansion would see a share of 1.9 percent and a net loss of $2.1 billion.

From 2014 to 2016, the federal government will cover 100 percent of the expansion before tapering to 90 percent by 2020.

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