Expanding Medicaid Will Save States Money – But Not Likely In Alaska

Good state-level analysis on Medicaid expansion is hard to come by, particularly in Alaska.  We’ve highlighted a few challenges here and here.  Moreover, when facts are not particularly clear or well understood, they become questioned by stakeholders.  This can sometimes lead to facts becoming political footballs rather than the underpinnings of good policy.

We work on Medicaid issues in a number of states and a number of contexts.  With that said, I’ve found this study by the Robert Wood Johnson Foundation and the Urban Institute to offer some of the best state-level cost analysis of anything publicly available.

Here’s the bottom line of the 18-page analysis.

–  After all costs are considered, state governments will save a collective $14 billion by implementing the Affordable Care Act.

–  State level analysis is difficult to do, so only the knowable savings are projected.  The national analysis suggests higher numbers, but state-by-state analysis errs on the side of conservative caution.

–  States currently with richer Medicaid benefits and/or eligibility will likely save more than states with less rich benefits and/or eligibility.

For the states we follow here at State of Reform, that means the following potential ranges of costs and savings.  Positive numbers below represent a net increase in costs to the state, while negative numbers represent a net savings.

State Low Savings High Savings
Alaska 50 -7
Oregon -626 -996
Washington -667 -988

In other words, what might be a great cost savings in one state might well result in an increase in costs to the state.  And, in Alaska – based upon this analysis – that outcome appears more likely than not.