Medicaid expansion would create almost 2,000 jobs, study says

Morgan Hughes, Casper Star-Tribune via Wyoming News Exchange
Posted 5/21/21

The report predicts major economic gains for states that leverage a temporary federal incentive to expand Medicaid to cover more low-income residents.

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Medicaid expansion would create almost 2,000 jobs, study says


CASPER — Expanding Medicaid could create nearly 2,000 Wyoming jobs and grow the state’s overall economic output by $1.5 billion in five years, according to a new report published Thursday.

The report predicts major economic gains for states that leverage a temporary federal incentive to expand Medicaid to cover more low-income residents. It comes just over a week after a legislative committee backed reviving the expansion debate in Wyoming.

The new estimates come from national think tank The Commonwealth Fund, which analyzed how a special federal bonus being offered to non-Medicaid expansion states through the American Rescue Plan Act could bolster those states’ economies.

Medicaid is a government health insurance program that in Wyoming mostly covers pregnant women and low-income children. Expansion would allow many low-income adults to enroll as well. All but 12 states have elected to expand their programs, but lawmakers here have debated for nearly a decade whether to take that step. Cost has been the main concern.

The Biden administration is hoping to entice the holdouts by offering a two-year bonus in the federal money those states receive to pay Medicaid costs. Wyoming policy analysts estimate that bonus would save the state $34 million over the next two years after subtracting the $20 million it would have to contribute.

The report predicts expansion will stimulate the economy in a number of ways, resulting in higher economic output by the state and a growth in average personal income “particularly because of increased employment,” the report reads.

In Wyoming, “economic output,” meaning manufacturing and retail activity, would grow by $1.5 billion by 2025, according to the think tank. Overall statewide personal income is estimated to grow by $37 million.

The report also affirms testimony from the state’s various health care associations that expansion would reduce the amount of unpaid bills hospitals are left to pay.

“Expansion will yield other savings for states that we have not included in our estimates. For example, as Medicaid coverage rises and the number of uninsured falls, state and local governments can reduce the amount spent on charity or uncompensated care for those without insurance and for mental health and substance use services,” the report reads.

Not all of the estimates jibe with local analyses, however.

That outpaces the Wyoming Department of Health’s prediction of 24,000 new enrollees, but it is within the department’s statistical models, 90% of which anticipate enrollment between 13,000 and 38,000.

The report also estimates a higher share of costs for Wyoming (as well as more enrollees) at $49 million for the first two years, but it estimates the state would receive an additional $300 million in federal dollars.

The health department in a report to lawmakers this March had a more conservative estimate, writing “for State Funds, we are 90% sure costs will be $14-$27 million over the first two-year period.” The health department’s estimates were derived through more aggressive modelling than this report, according to both methodologies.

Both entities acknowledge uncertainties in the modelling.

While the exact numbers can’t be known unless and until Medicaid is expanded, the federal incentive did sway several lawmakers during the March legislative session who had long been opposed to expansion.

Longtime opponent of expansion, former House Speaker Rep. Steve Harshman, R-Casper, gave an impassioned speech to the committee that ultimately killed the bill this March asking its members to advance the legislation.

“I’ve always prided myself as the most pro-life speaker in the history of Wyoming,” Harshman told the committee. “These are lives too.”

While that bill died, lawmakers are hoping to get another chance to debate the federal bonus. The Legislature’s Joint Revenue Committee on May 11 voted to revive the previously killed bill at either a special session in July or a budget session in February. Exactly when will depend on legislative leaders who set the session agendas.