HELENA – A report released Saturday says that expansion of Medicaid largely paid for with federal money would boost the state economy.
Gov. Steve Bullock is proposing that the state expand Medicaid to about 60,000 more residents with money offered under the federal health care law. The state’s share of this expansion would be a small fraction of the overall cost, about $5 million.
The proposal is being eyed with skepticism by Republican legislators. They argue the federal funding could dry up in future years and leave the state with the choice of either paying the bills or cutting people from the program after they become accustomed to it.
The target population for Medicaid expansion is uninsured people making less than 138 percent of the federal poverty level, or $31,809 for a family of four.
Bullock has included the proposal In his budget currently being considered by the Legislature. A U.S. Supreme Court decision last year made the Medicaid expansion optional for states.
A University of Montana Bureau of Business and Economic Affairs economist says in a 50-page report released Saturday that the federal money attached to expansion would lead to 5,300 new jobs next year. The report was prepared for State Insurance Commissioner Monica Lindeen.
The report says that one in five Montanans does not have health insurance. Uncompensated care in Montana hospitals costs taxpayers almost $150 million in 2010, the report found.
The federal money would also expand the economy, the economists said.
“New federal dollars will flow into Montana as the federal government supports each state’s Medicaid expansion. These dollars otherwise wouldn’t exist, and as such, new dollars create jobs, labor income, and potential new tax revenues for state governments,” the report said.
The bureau estimated more than 5,000 jobs would be created in 2014, with an average wage of $42,000, as a result of the influx of federal money. The state taxes on the new labor income would result in roughly $55 million more in state revenue in 2014, far more than the required state expenditure for expanding the program.