Evaluating Medicaid Expansion in Georgia -- for Disability Claimants and the Uninsured

November 27, 2012

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Now that the election is over, and we know that the Affordable Care Act is here to stay, Georgia must decide whether it intends to expand its Medicaid program. This summer, the United States Supreme Court upheld the Affordable Care Act as constitutional, but left open the possibility for states to opt out of expanding their Medicaid program.

Budget analysts predict that the cost of Medicaid expansion in Georgia will be $1.8 billion over the next ten years. That is a 4.1% increase in spending. Georgia currently has approximately $1.9 million uninsured citizens. Of those, about 700,000 would be eligible for Medicaid.

Georgia Governor Nathan Deal has opposed expansion, although he now seems to be weighing his options. Governor Deal has indicated that he would support a "block grant." A block grant would allow the federal government to deposit a set amount of funds to Georgia for Medicaid coverage with no corresponding state contribution. Currently, there is no federal congressional authority for block grants. Governor Deal argues that the state cannot afford an expansion of the program and does not have the funds now or in the future. Currently, Georgia is running a deficit on Medicaid financing.

States in the Southeast with high numbers of uninsured citizens will likely face additional costs with the expansion of Medicaid. However, more insured citizens also alleviate the burden on hospital and emergency rooms. The cost burden to states for uncompensated care will fall.

States, such as New York, Arizona, and Maine, that have already expanded Medicaid coverage have seen an improvement in overall health, access to care, and coverage for the uninsured. However, these states do not have the high numbers of uninsured waiting to join the Medicaid rolls, and therefore, the cost of expansion is more easily spread across the state.

Proponents of expansion argue that an expansion of Medicaid would inject $40 billion of federal funds into Georgia's health care economy over the next ten years. Proponents further argue that even if Georgia refuses to expand its program, it will likely see a rise in Medicaid costs as more people apply into the system.