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Medicaid expansion could bring big benefit to state with little investment

Sacramento Business Journal, January 9, 2013

  By Kathy Robertson

California has an opportunity to significantly increase health coverage at a minimal cost to the state budget by expanding its Medicaid program under the Affordable Care Act, a new study concludes.

More than 1.4 million California adults under age 65 will be newly eligible for Medi-Cal, the state’s Medicaid program, under federal reform.

Somewhere between 750,000 and 910,000 of those are expected to enroll by 2019, according to a joint study by UC Berkeley’s Center for Labor Research and Education and the UCLA Center for Health Policy Research.

Overall, the federal government will pay for at least 85 percent of the total new Medi-Cal spending between 2014 and 2019.

Medi-Cal expansion and enrollment growth among those already eligible is predicted to bring between $2.1 billion and $3.5 billion in new federal dollars to California in 2014, growing to between $3.4 billion and $4.5 billion in 2019.

Increased state tax revenue and savings will largely offset new state spending, the report concludes.

The U.S. Supreme Court made Medicaid expansion optional for states, when it ruled on the Affordable Care Act in June, but California legislators have not formally approved such a change.

Soon, a special session of the Legislature is expected to consider bills to authorize the expansion. Many other states have balked, worried about cost.

“This study shows that the Medicaid expansion would be a boon, not a burden, to the state of California,” Anthony Wright, executive director at Health Access, said in a news release. “The state should take quick action to be ready for reform.”

Original Article

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