Lives and Livelihoods Lost: The High Cost of Rejecting Medicaid Expansion

Governors and lawmakers in 25 states who reject federal support to expand state Medicaid programs are sacrificing thousands of lives and pushing away enormous economic development benefits that come with $426 billion in direct funding over 10 years, according to a new report by Health Care for America Now (HCAN), the nation’s leading grassroots health care advocacy group. While states that fully participate in Medicaid provisions of the Affordable Care Act (ACA) will enjoy new federal investment and improved economic growth, residents of states rejecting Medicaid expansion face a declining quality of life, a weaker economy and destabilized hospitals—including some that will be forced to close, according to the report. Research at the Harvard School of Public Health suggests that the 25 states’ refusal to accept the Medicaid funds may result in the deaths of 27,452 Americans in 2014 as those states forgo funding of health benefits that are expected to reduce mortality rates for low-income adults.

In this report, HCAN reports these key findings:

  • Medicaid expansion can be expected to reduce mortality rates among low-income adults to 6.1 percent below that of neighboring states that reject the program. Extending Medicaid benefits to this population prevents 2,840 deaths per year for each 500,000 adults gaining coverage, according to a study by Harvard researchers in the New England Journal of Medicine. Based on this formula, governors and state lawmakers who are blocking access to health care for 4.8 million low-income people will prevent Medicaid from saving 27,452 lives in 2014 alone.
  • Hospitals in non-expansion states will be put at a significant competitive disadvantage, resulting in insurance companies excluding them from provider networks because the hospitals must charge insured patients higher fees to cover uncompensated care costs. Hospital administrators will offset lost network business by increasing out-of-pocket costs for people with private insurance, according to a hospital finance expert and medical school professor at Johns Hopkins University Bloomberg School Public Health. Hospitals in those states are already being negatively affected with higher borrowing costs in Wall Street bond markets from which they obtain funds for construction and other major projects.
  • While rejection of Medicaid expansion and other ACA programs may satisfy the ideological fervor of many Republican officeholders, it does not relieve health care providers of the legal and ethical obligation to provide emergency care and stabilization to the uninsured under the Emergency Medical Treatment and Labor Act. That law was enacted with President Ronald Reagan’s approval in 1986. The cost of complying with emergency treatment laws will not go away, and the burden of uncompensated care must be borne by hospitals, doctors, local taxpayers and charities.

Population of focus: States

Links to resource:

Date: 2013

Organization: Health Care for America Now