A Healthy Blog

Massachusetts health care — wonky, with a healthy dose of reality

MassHealth is Critical, and a Bargain for the state

MassHealth is Critical, and a Bargain for the state

May 16, 2017

We hear over and over again criticism that MassHealth comprises 40% of the state budget. This ignores two key realities:

1. MassHealth provides critical health care to over a quarter of state’s population – very low income people with no other source of health care. The majority of expenses are to provide care to very sick people, particularly seniors and people with disabilities getting long-term care and support services. Seniors and people with disabilities account for 24% of the enrollees, but 56% of the spending. The 595,000 non-disabled children are just 16% of the spending (source).

2. A new report from the Massachusetts Budget and Policy Center makes clear that, because of federal funding, the cost to state taxpayers is much less than is portrayed. The 40% number bandied about (it’s actually 37%) is the total cost of the program, including federal funds, compared to the entire state budget. But if one just looks only at state taxpayer funds, the cost of MassHealth is just 24% of the state's tax revenue  - certainly a bargain. Moreover, the federal funds we get as a result are spent in the local economy, paying salaries for medical care provided by community health centers, nurses, lab technicians, and many more. Those wages are then used to pay for food, rent, entertainment and other local services, fueling the economy even further.

These graphs, from the MassBudget report, illustrate this conclusion:

State Net cost of MassHealth

Please feel free to share this message to everyone concerned about the state budget. With Congress considering deep cuts in federal Medicaid funding, which would have a devastating impact on the state budget, we need to come together to defend Medicaid at the state and federal levels.

                                                                                                                                       -- Brian Rosman