Note: This article is part of Mississippi Today’s ongoing Mississippi Health Care Crisis project. Read more about the project by clicking here.
Perhaps no other federal-state policy has been studied and debated more than Medicaid expansion per the federal Affordable Care Act, including its potential impact on Mississippi — one of just 12 states that has not expanded the program.
A Kaiser Family Foundation report notes there have been more than 400 studies on the topic nationwide. And in Mississippi, the poorest and unhealthiest state in the nation, numerous studies have focused on what expansion would mean. A majority project net positive benefits economically, health-wise or both.
Expansion would mean someone making $18,754 a year (138% of the poverty level) would be eligible for health care coverage through the federal-state program. The federal government would pay 90% of the costs for those covered, with the state paying 10%.
When Medicaid expansion began Jan. 1, 2014, the federal government paid 100% of the costs, stepped down to 90% over years. Mississippi missed out on the larger matching rates from the federal government.
But under the recent American Rescue Plan, the 12 states that have not expanded Medicaid have been offered a financial incentive to do so. That equates to more than $700 million for Mississippi, and more recent studies have factored in those incentives.
The studies on Medicaid expansion in Mississippi
• Mississippi University Research Center/IHL, 2021: This analysis of the fiscal and economic impact of expansion was authored by state Economist Corey Miller and senior Economist Sondra Collins. It found expansion would add about 230,000 adults to Mississippi’s Medicaid rolls between 2022 and 2027. It would produce an average of 11,000 new jobs a year during that time and provide an additional $44 million a year to the state general fund.
The study found that expansion would increase the state’s gross domestic product by more than $700 million a year over five years, increase personal income between $539 million and $812 during the same period and increase the state’s population between 3,300 and 11,500 annually over the same period.
• Commonwealth Fund study, 2021: The study estimates expansion would cost the state $956 million over five years, while generating $1.2 billion in savings for a net gain to state coffers of $212 million. The study estimates expansion would provide coverage for about 230,000 adults.
• Urban Institute/Robert Wood Johnson Foundation national study, 2020: This was a study of the impact of expansion on the then 15 states that had not expanded Medicaid. The study projected that expansion in Mississippi would bring an increase of 207,000 enrollees and an increase in state Medicaid costs of $177 million a year, but did not attempt to calculate any increased revenues or savings.
• Perryman Group study of Mississippi Cares plan, 2019: This was a study of the Mississippi Hospital Association’s “Mississippi Cares” alternative expansion plan. MHA proposed creating a public-private partnership, expanding eligibility to adults earning up to 138% of the poverty level, but imposing a $20 a month premium on enrollees and a $100 copay for non-emergency use of hospital emergency rooms. Hospitals would cover remaining state costs. The Perryman study projected the plan would create an additional 36,000 jobs a year on average for the first 11 years and provide an increase in state tax revenue, a decrease in private insurance premiums and a reduction in uncompensated care costs of $252 million a year. The plan also included a requirement that unemployed beneficiaries enroll in job training or education programs.
• University of Alabama Birmingham study for Mississippi Health Advocacy Program, 2013: This study, by UAB’s Department of Health Care Organization and policy, modeled the impact of expansion on enrollment, state and federal costs, employment and state tax revenue from 2014 to 2020. It projected expansion would result in 212,362 more enrollees by 2020, would generate 19,318 additional jobs in 2020, with $200 million in additional state and local tax revenue. It projected an overall state budget savings of $34 million in 2020 and projected expansion would produce $2 billion in economic activity annually.
• Kaiser Foundation/Urban Institute national study, 2012: This study projected the effect of expansion on costs and enrollment nationally and by state from 2013 to 2022. The study projected expansion in Mississippi would cost the state about $1 billion for the period, and result in an additional 231,000 enrollees. The study listed the additional costs without estimates of any savings or increases in tax revenues.
• Mississippi University Research Center/IHL, 2012: This study projected the impact of expansion on Medicaid costs, enrollment, and net economic impact on the state budget from 2014-2025. The study used three scenarios, high, medium and low participation, predicting that high participation of an additional 310,000 enrollees was most likely. It predicted the state’s cost of expansion would be about $118 million by 2020, but that expansion would create about 9,000 new jobs a year and have a net positive impact on the state budget of nearly $65 million by 2020.
• Milliman Inc. study, 2010, 2012: The Mississippi Division of Medicaid contracted this analysis of Mississippi Medicaid’s budget exposure to the ACA from fiscal 2011-2020, and it was updated in 2012 and is still referred to frequently by opponents of expansion. The report modeled three scenarios – low, moderate and high enrollee increases and said moderate or low scenarios were most likely. The report projected under the moderate scenario that 243,000 additional adults and 67,000 more children would enroll and the state share of Medicaid costs would increase by $1.26 billion over the time period, including costs for current and additional enrollees. It estimated that by fiscal 2020, the state would see increased costs of $280 million a year.
The 2012 report modeled enrollment and costs from fiscal 2014-2020 under various scenarios. Under the higher enrollment scenario, it estimated expansion would cost the state $155 million a year by 2020. It focused on the Medicaid budget and did not estimate any cost offsets from other programs or from additional tax revenue.