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Wednesday, 04 December 2013 00:00

Study: Refusal to expand Medicaid is costing Texas billions

Written by  Robert T. Garrett | Dallas News
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AUSTIN — If Texas keeps refusing to enlarge Medicaid under the Affordable Care Act, the state will pass up a heap of money, a new study has found.

In 2022, the state would pass up federal money for Medicaid expansion equal to more than twice its haul that year in federal highway aid, according to researchers Sherry Glied and Stephanie Ma of New York University.

Texas would forfeit $9.6 billion of federal Medicaid matching funds in 2022. That’s one-fourth of what the federal government expects to spend on defense contracts in the state that year, the study said.

“No state that declines to expand the program is going to be fiscally better off because of it,” said Glied, a former Obama administration health planning official who is dean of NYU’s Robert F. Wagner Graduate School of Public Service.

Texas Republican leaders have resisted Medicaid expansion, saying federal rules are too rigid and state costs in future years would soar. GOP leaders predict that federal budget cuts and the Affordable Care Act’s rollout problems will force a rollback of the generous pledge of federal funding.

Last year, Texas took $17 billion in federal money for its $28 billion Medicaid program. It currently covers 3.6 million children, pregnant women, seniors and disabled Texans.

More than 1 million poor adults of working age would be added to the program by 2016 if Texas changed course and embraced expansion, according to the state Health and Human Services Commission.

The study was sponsored by the Commonwealth Fund, a nonprofit group that argues for improvements in health care accessibility and affordability. It said Texas in 2022 would have to pick up 10 percent of the Medicaid expansion tab. The state cost would be $1.2 billion.

If state leaders persist in rejecting expansion, Texans still would pay for other states to cover low-income adults through their income, corporate and estate taxes paid to the federal government, Glied and Ma wrote.

“Their tax dollars will be used to support a program from which nobody in their state will benefit,” Glied said in a written statement.

Health policy analyst John Davidson said state leaders are right to rebuff the federal money.

“Until Medicaid is fundamentally reformed, it’s reckless to expand it,” said Davidson, of the free market-oriented Texas Public Policy Foundation.

Anne Dunkelberg, associate director of the Center for Public Policy Priorities, which advocates for low-income Texans, said the study highlights how Medicaid already is “a major job generator” in the state.

“It’s just hard to imagine that Texas would even consider giving up a quarter of our defense contracts,” she said. “We would consider it calamitous, yet in the current [political] climate, that’s the kind of decision that’s being promoted.”

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