Medicaid expansion brings states more funds than federal highway program

The Medicaid program plays a unique role as a program among states, requiring them to contribute their own revenue while also acting as "the largest source of federal revenue to states," according to a new issue brief by the Kaiser Family Foundation.

The brief, "Medicaid Financing: How Does it Work and What are the Implications?" delves deeply into the program, which is the third largest government program in the United States behind Medicare and Social Security.

The Kaiser Family Foundation concluded that the Medicaid program has a net economic benefit to states. "The influx of federal dollars from the way the Medicaid program is financed has positive effects for state economies," the report said. "The infusion of federal dollars into the state's economy results in a multiplier effect, directly affecting not only the providers who received Medicaid payments for the services they provide to beneficiaries, but indirectly affecting other businesses and industries as well."

Twenty-two states have so far declined to expand Medicaid, all of which have Republican-led legislatures that are opposed to doing so for ideological reasons.

The report concluded that states that have expanded Medicaid program eligibility under the Affordable Care Act enjoy more economic benefit than the states that have so far declined to do so, and that the amount of money flowing into the states through expansion is 1.35 times higher than what is received through the federal Highway Program.

New Hampshire, which only expanded its program last year due to an impasse among its lawmakers, saw a dramatic change that was nearly instantaneous: Emergency room patients without insurance dropped 22 percent between April 2014 and last March, the Concord Monitor reported

The Kaiser Family Foundation report did not delve into the clinical benefits of Medicaid expansion, such as the unearthing of huge numbers of undiagnosed diabetics.

To learn more:
- read the Kaiser Family Foundation issue brief 
- check out the Concord Monitor article