For states like Ohio that are straddling the fence on Medicaid expansion, the moment of truth has arrived. The Obama White House on Monday rejected the option some governors have floated to partially extend Medicaid coverage .
The Affordable Care Act initially required states to expand Medicaid, the federal- and state-funded health program for the poor, to uninsured individuals earning up to 133 percent of the federal poverty level (or 138 percent when the first 5 percent of earnings is disregarded). It was a carefully crafted proposal to reduce the population of uninsured Americans. From 2014 through 2016, the federal government would pay 100 percent of the cost to cover the newly eligible and then gradually scale down the match to 90 percent.
But ruling on the constitutionality of the legislation this summer, the Supreme Court made the expansion optional, and several governors, including John Kasich, decided to delay a decision while they explored the budget implications. They hoped the Obama administration would permit an option to cover individuals to 100 percent of the poverty level, for example, and still collect the federal match. With that balloon popped, Ohio officials must reach a quick decision. They have argued it will be unwise to expand Medicaid before figuring out how to cover the $700 million it will cost to enroll about 300,000 residents who currently are Medicaid eligible but not yet enrolled.
Fair enough But the reasons to proceed with an expansion are compelling. Estimates are that more than 457,000 uninsured Ohioans will gain health coverage over the next decade if eligibility is expanded as stipulated in the law. The federal government is committed to cover on average 93 percent of the cost of the newly eligible residents. An analysis by the Urban Institute has indicated that Ohio Medicaid will cost $263 billion between 2013 and 2022 without an expansion, the state responsible for $93 billion of it. Expand the program, and the additional cost to the state would be roughly $3 billion over the 10 years — in all a minimal price for reducing the number of uninsured, improving health and cutting the cost of uncompensated care and other services used by the uninsured.