Featured image for article

Analyzing the Costs of Expanding Medicaid in North Carolina

From JLF’s Health Care Policy Analyst, Jordan Roberts:

Elected officials in North Carolina have debated Medicaid expansion for years. The question at hand is whether to accept a generous matching rate from the federal government to add roughly 500,000 new enrollees to the Medicaid rolls, which already serve over one-fifth of the state’s population — over 2 million elderly, disabled, children, and mothers. There are Democratic and Republican proposals to achieve this goal. The effects of expanding Medicaid, particularly costs imposed directly on taxpayers and dispersed in the private market, are central to the discussion.

State legislative proposals would cost the state between $400 and $600 million over the first two years, 10 percent of the $4 to $6 billion total cost, according to bill sponsors and the Gov. Roy Cooper’s budget. To pay the 10 percent state share of Medicaid expansion, both Republican and Democratic proposals would impose new provider taxes and taxes on the new Medicaid managed care plans. The Republican-sponsored proposal would also raise funds from enrollee premiums.

Sponsors of the proposals claim that expansion would be “free” to the state because provider taxes would pay for the 10 percent state share, but there would likely be additional costs. What effect would Medicaid expansion have on private health care costs in the state? How would emergency room utilization be affected by expansion? How much would the expansion population crowd out private insurance? A recent report from the Wisconsin Institute for Law & Liberty (WILL) examined some of these questions.

Read more here.

Reader Comments