Maine Musings: Increase Access to Affordable Health Care

The following does apply to Maine and increased access to affordable health care. Just bear with me and you’ll see why I’m discussing the New Hampshire legislature. This week the New Hampshire legislature voted to reauthorize the NH Health Protection Program aka Medicaid Expansion. “The Health Protection Program represents New Hampshire’s unique, market-oriented approach to improving access to affordable health care, deploying federal funds to help low-income adults purchase private sector health insurance.” ~ NHFPI ~

Since it was instituted in 2014, the program has grown to serve nearly 48,000 low-income Granite Staters, it has dramatically decreased the number of uninsured adults in the state, cut uncompensated care costs to hospitals, and brought budgetary savings to NH cities and towns, it also includes substance abuse treatment in a state in the midst of an opioid crisis. And now, thanks to some great bi-partisanship in the NH House and Senate, the state will see nearly $870 million in federal funds being injected into the New Hampshire economy between FY 2017 and FY 2019.

I tell you this because the Maine Legislature has another opportunity to accept hundreds of millions of dollars in federal funds and offer increased access to affordable health care for tens of thousands of working Mainers. The bill, LD 633, is up for a vote this legislative session.

MaineCare expansion is a good deal for the people of Maine, as explained in this op-ed by James Myall in the Times Record last month.

MaineCare Expansion Is Still A Great Deal

$720 million is a lot of money. How much? It’s about twice the amount spent from the state’s highway fund every year. But it’s also the amount of money Maine has left on the table since 2014 by failing to expand MaineCare (Maine’s Medicaid system) and take advantage of a huge infusion of federal money to our state. Bipartisan majorities have passed five MaineCare expansion bills but have fallen short of the two-thirds necessary to override Gov. LePage’s veto.

This year, there’s reason to hope the outcome will be different. Republican Senator Tom Saviello of Wilton, is leading the latest bipartisan effort to level the playing field and provide equal access to affordable health care. Just as important, pressure is growing as Maine becomes increasingly isolated in its failure to accept federal funds, and as the body of evidence grows that MaineCare expansion is a boon for Maine’s jobs and economy.

Expansion opponents overlook state budget savings that will offset future costs. An October 2015 Kaiser Family Fund survey of state Medicaid directors reported that a number of expansion states have indeed realized such savings. Closer to home, a recent Maine Health Access Foundation (MEHAF) commissioned report identified $26.7 million in net savings to the overall state budget had MaineCare expansion taken effect in 2016.

Here are ten reasons Medicaid expansion makes budget sense for Maine:

  1. The federal government picks up most of the tab. Through 2016, the federal government is committed to paying 100 percent of the costs of expanding Medicaid in the states. In 2017, that share will decrease to 95 percent, and to 90 percent in 2020. And the state share is legally capped at 10 percent for those in the expanded program. It’s highly unlikely that future congressional majorities will vote to take millions of dollars and access to affordable care away from their constituents.
  2. The cost of covering those newly eligible under expansion (mostly adults without disabilities) is lower than the per-person cost of those MaineCare currently covers. MaineCare already covers the most vulnerable populations (the elderly, disabled and children) who require the most and the costliest care.
  3. Expansion will effectively move some individuals from the existing MaineCare program, and into the expansion category (which the federal government reimburses at the higher rate).
  4. Expansion will mean savings in other areas of the state budget (e.g., mental health and substance abuse programs, prescriptions for seniors, family planning, and treatment for prisoners).
  5. Better preventative care for those expansion covers will result in lower future health care and related costs.
  6. Other Affordable Care Act (ACA) reforms will slow the rate of growth in state Medicaid spending for those in the existing program; the Congressional Budget Office predicted increased state costs of only 2.8 percent over Medicaid costs without ACA passage.
  7. Hospitals will gain more revenue from newly-insured patients resulting in increased Maine hospital tax revenue.
  8. Hospital debts from uncompensated (or “charitable”) care will drop by around 40 percent, according to a Robert Wood Johnson Foundation study, reversing the trend of Maine’s hospitals taking on ever-increasing debt loads over the past few years.
  9. MaineCare expansion will create more than 3,000 jobs in Maine and stimulate more than $300 million in Maine economic activity. Not only is this better for all Mainers, but a stronger economy means $16-18 million in additional state revenue from sales and income taxes according to a 2013 Maine Center for Economic Policy (MECEP) estimate.
  10. States with cost overruns have underestimated the number of people eligible to enroll. Maine has an advantage because we’ve insured some of these people before (prior to the 2014 changes to MaineCare eligibility) — but regardless, these aren’t costs that inevitably spiral out of control; it’s simply a matter of budgeting accurately.

Expanding MaineCare is a good deal for Maine — not only will it improve health care access for tens of thousands, its impact on Maine jobs and economy will benefit us all. Mainers know a bargain when they see one — but somehow, we’ve allowed legislators and the governor to let almost a million dollars a day slip through their hands since January 1, 2014. Let’s hope this time, Yankee frugality prevails over ideology.

James Myall is a resident of Topsham and a policy analyst at the Maine Center for Economic Policy

Mainely Kids

And there is this from the Maine Center for Economic Policy:

Accepting Federal Funds for Affordable Health Care
Still a Great Deal for Maine

Hundreds of millions of dollars, thousands of jobs, and improved health for tens of thousands of Mainers are still available to Maine, if legislators choose to accept federal funding to expand access to affordable health care.

Good for Hospitals

Health care systems in states that have accepted federal funds to increase health coverage have seen uncompensated care costs decline by up to 40%. Rather than going to the emergency room for expensive catastrophic care, and not being able to pay, low-income Mainers will be able to pay their bills via MaineCare (Maine’s Medicaid system). For Maine’s hospitals, which shouldered $570 millionin charity care and bad debt in 2014, this would be a particularly meaningful change. The situation is especially acute in non-expansion states like Maine, because Medicare reimbursement rates to hospitals were cut in order to pay for the very Medicaid expansion funds that Maine is refusing to accept.

Good for Healthy Mainers

Maine is the only state where the uninsured population has not declined since the passage of the Affordable Care Act. Worse, in 2014, 5,000 fewer Maine children had health insurance coverage than in 2010. Studies show that individuals, especially children, with Medicaid coverage are more likely to have a primary care physician and to seek preventative care, reducing their future health needs and costs. Medicaid recipients are 55% more likely to have a primary care doctor, 60% more likely to receive screenings like mammograms, and 25% more likely to report being in good health than those without insurance.

Good for Maine’s Workforce

Participation in Maine’s labor force has been shrinking for the past ten years. Most of that reduction is due to working-age adults leaving the labor force. 45% of working-age Mainers who dropped out of the labor force in 2014 did so due to illness or disability. Expanding access to affordable health care allows more Mainers the chance to get back to work.

Good for Maine’s Economy

Some $320 million of federal money would flow into Maine in 2017 to cover the overwhelming majority of costs associated with ensuring that everyone living below 138% of the Federal Poverty Level (that’s a household income of $22,108 for a family of two) has access to affordable health care. The federal government will cover 95% of the costs of providing health care to newly-qualified individuals in 2017, and at rates that will gradually decline to 90% by 2020. But that still means the state shares only 10% of the cost.

Good for State Revenues

Not only does the federal government pick up most of the tab, but MaineCare expansion saves the state money in a number of different areas. The state can use these federal funds to cover many Mainers already enrolled in the program (e.g. pregnant women, people with disabilities). Additionally, new federal dollars will pay for other potentially eligible health care costs —inpatient services for prisoners, and mental health and substance misuse programs —that Maine currently pays for. In total, these savings would amount to over $40 million per year for Maine.

An additional 4,000 jobs, increased hospital revenues, and nearly half a billion dollars in additional economic activity would generate another $23 million in tax revenue for the state.

Good for Tackling the Drug Crisis

The state’s substance abuse epidemic has dominated Maine’s political discourse for months―but little attention has been paid to the fact that 44% of heroin abuse treatments were for patients without insurance. For methamphetamine abuse, the figure rises to 68.2%. Access to health care would drastically improve the rate of addiction treatment in Maine, and help prevent some of the 250 estimated overdose deaths that occur in the state each year.

A Good Deal for Maine

Because Maine has a strong track record of providing access to health carefor low-income individuals and families and has over a decade of experience managing a well-run Medicaid program, we are well-positioned to maximize the benefits of accepting federal funds and unlikely to experience enrollment spikes seen in other states.

Accepting hundreds of millions of dollars in federal funding on offer to expand access to affordable health care to tens of thousands of Mainers will improve the health of our workforce and the strength of our economy. It will result in millions of dollars in savings and increased revenues. And it will come at relatively little cost to the state’s general fund. It is hard to imagine a better deal for Maine.

The Maine Center for Economic Policy is a non-partisan, non-profit policy research organization committed to advancing economic justice and prosperity for all Maine people.