Tate Reeves and Philip Gunn may be wishing Mississippi would employ a different state economist.
The current holder of that job, Corey Miller, first threw cold water on their proposals to eliminate the state’s personal income tax, saying it would not produce the surge in economic and population growth that the governor and speaker of the House envision.
Now Miller, in an analysis with the state’s other top economist, Sondra Collins, has debunked the Republican duo’s repeated claim that Mississippi cannot afford to expand Medicaid to cover the working poor.
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Instead, anyone reading the economists’ 20-page report should come to the conclusion that the exact opposite is true: Mississippi cannot afford to NOT expand Medicaid.
That conclusion is not necessarily novel. Prior studies by other groups and economists have come to a similar finding, but those have been dismissed by Republican leaders as tainted because of the authors’ affiliation with entities in favor of expanding the government insurance program.
Miller and Collins, who work for the state’s University Research Center, make it clear in the second sentence of their report that they are not offering a recommendation on whether Mississippi should expand Medicaid. Still, their work takes the guts out of the argument of Republican opponents and affirms that for the past decade this state’s leadership has been guilty not only of hard-heartedness but fiscal malpractice.
In the early years of Obamacare, GOP opponents to Medicaid expansion hung their hat on a 2012 University Research Center study that estimated it would cost state government over a 12-year period about a half-billion dollars to fund the expansion, even with the federal government picking up at least 90% of the cost in benefits.
That earlier analysis, though, was flawed in that it failed to take into account numerous cost savings that the state could expect to realize from Medicaid expansion.
For example, as the newest study points out, there are about 20,000 disabled individuals or pregnant women enrolled in traditional Medicaid at any one time who could be moved to the expansion group based on their income level. Because the federal government picks up a larger share of the cost of covering those in the expansion group than those on traditional Medicaid, the potential savings in those two categories alone is about $23 million a year.
There would be similar savings by cost-shifting to the federal government current state funding for cancer treatment, family planning services, mental health and substance abuse programs, and inpatient care of inmates.
But by far the biggest cost savings from Medicaid expansion is in reducing the costs at Mississippi hospitals of treating patients who are uninsured — an area not covered in the 2012 report. Miller and Collins project the uncompensated care savings to average almost $170 million annually over the next six years, and that’s a low estimate. Others have put the figure as high as twice as much.
Add it all up, and the savings would equal the cost of expansion — not even counting the $40 million a year the state could expect to collect in additional taxes from the thousands of new health-care jobs and other economic growth Medicaid expansion would create.
Admittedly, the state economists’ estimated savings on uncompensated care take into account all hospitals in Mississippi, not just those owned by the state. Thus about 80% of that benefit would go to other publicly owned hospitals, such as Greenwood Leflore Hospital, or privately owned hospitals, not directly to the state.
The Mississippi Hospital Association, though, has already offered an answer to that. It has produced a plan that would tax hospitals and put a small monthly fee on beneficiaries, which combined should more than cover any shortfall in the state’s portion of funding the expansion.
Plus, in an effort to get Mississippi and the other 11 holdouts on board, Congress this year added one more huge carrot that would generate for this state more than $600 million in Medicaid savings during the first two years of expansion. That could be squirreled away to help cover any shortages in the state share, should they occur down the road.
Will the state economists’ calculations soften the GOP opposition? Not likely with Reeves, who has shown that he only wants to play politics on Medicaid expansion. Gunn is not much better.
The main hope that reason could eventually prevail at the Capitol lies with Lt. Gov. Delbert Hosemann. That sensible Republican probably would like to take the billion dollars a year the feds are offering to Mississippi if he can figure out how to massage it past the pigheaded in his party.
- Contact Tim Kalich at 662-581-7243 or tkalich@gwcommonwealth.com.
