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Another Reason Why National Health Care Reform is Good for Massachusetts

Another Reason Why National Health Care Reform is Good for Massachusetts

June 19, 2010

In advance of the BCBS Foundation Forum on Monday on the impact of national reform on Massachusetts, we want to highlight a new report by the Kaiser Commission on Medicaid and the Uninsured that provides another reason why national health care reform will benefit Massachusetts: money.

This analysis, prepared by the Urban Institute, estimates how each state will fare fiscally in terms of Medicaid spending under national reform. For most states, the requirement to expand coverage means a modest increase in state expenses.

But for Massachusetts and a few other states, the tables are turned. We make money in the deal.

The report looks at two enrollment scenarios for adults up to 133% of the federal poverty level and, in both circumstances, Massachusetts is one of only a few states that would actually save money compared to what we would have spent without national health care reform.

The first scenario presented in the report assumes moderate levels of participation in people newly eligible for coverage and minor participation among those currently eligible. Under this lower participation rate assumption, Massachusetts would be one of only four states to save money. We would save over $1.2 billion for Medicaid enrollees than we would have spent if health care reform had not passed. This savings occurs because of Massachusetts’ already covers these childless adults and the reform law provides us with higher matching rates.

The second scenario assumes that outreach and enrollment campaigns spurred by the new legislation will create higher levels participation for newly and currently eligible individuals. In this situation, a larger portion of the increase in spending will be for coverage for currently eligible individuals. However, Massachusetts is one of only two states that would save money. Massachusetts would spend $628 million less that we would have spent had health care reform not been enacted.

We expect Monday's report to provide more details on the fiscal impact of reform in Massachusetts.

Health Care For All worked hard for the passage of national health care reform because it will dramatically improve health care in Massachusetts and nationally. This report is a further example of why national health care reform is good for Massachusetts.
-Emma Smizik