Working with the Robert Wood Johnson Foundation, Manatt analysts today released a report documenting the greater than $1.8 billion of state budget savings and increased revenues across eight states resulting from the decision to expand Medicaid. It’s a great report – well-documented and well worth reading – but two points really stood out for me as I reflected on the ongoing debate over expansion in 22 other states around the country.

• Every one of the eight states in the report, even using the conservative assumptions of the Manatt analysis, is on track to save millions of state dollars in 2015. Every one of these eight states then has significantly more money this year to spend on other priorities in the state like education and infrastructure. This gives some more important data to state legislative staff working on projecting budget costs. These staff are usually relatively conservative in their budget projections around the costs and savings from Medicaid expansion (and in other areas as well). This shouldn’t be a surprise – while state legislators always like more “availability” or more projected revenue to spend on their own priorities, state budget analysts have the unenviable task of trying to be as realistic as possible about projecting revenue and new program costs or savings when providing these same legislators budget numbers. Therefore, this actual documented budget experience in other states can help clarify that expansion states do save significant dollars.
• Critics of Medicaid often like to talk of a “broken systems” where “silos” in how we pay for and deliver care split the system up into a patchwork of programs. Well, now these critics can take heart. In every one of the states studies by RWJF/Manatt, state costs in multiple different eligibility programs under Medicaid are shrinking drastically as many more people now qualify based just on being poor, not because they meet a special eligibility category. For example, some women can qualify for Medicaid if they would not otherwise because they have breast or cervical cancer and some TB patients are allowed coverage as well. Other “medically needy” adults – those with extremely high medical expenses – can sometimes qualify for Medicaid under a separate category too. And some adults with disabilities might be in yet another category. Aside from the administrative costs of separating people into all these different categories, states providing coverage under these categories received significantly less from the federal Medicaid program –the state “match rate” – than they now do under the blanket Medicaid expansion for people under 138% federal poverty level. This doesn’t mean the need for these programs goes away, but overall a move towards a simpler system with fewer state costs is now emerging in these Medicaid expansion states – an ancillary benefit.