Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Report Backs Expanded Medicaid State Would Spend Less, Gain Federal Cash

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Report Backs Expanded Medicaid State Would Spend Less, Gain Federal Cash

Article excerpt

HARRISBURG -- As Gov. Tom Corbett deliberates expanding Medicaid access, the state Independent Fiscal Office on Tuesday released an analysis finding Pennsylvania would gain federal money and reduce state expenditures by doing so.

Mr. Corbett has declined so far to expand Medicaid access under the federal Affordable Care Act, a decision that fell to the states after the U.S. Supreme Court upheld the law's requirement that most people have health insurance but left states to determine if they would broaden eligibility for Medicaid.

His administration has said the expansion would add more than 800,000 new enrollees to the program and cost the state more than $4 billion in additional state tax dollars by the end of June 2021.

But in an analysis released Tuesday, the state Independent Fiscal Office found expanding Medicaid would have an average annual effect in the calendar years 2016 to 2021 of increasing federal expenditures by $3.2 billion and decreasing net state expenditures by $190 million.

Most state savings under expansion would result from moving people currently covered by a state-funded medical program to federally funded Medicaid, said Matthew Knittel, director of the IFO. The federal government is to cover the full cost of newly eligible Medicaid enrollees for three years, after which the federal share of the cost would decrease to 90 percent in 2020.

After the release of the report, the governor's office and the Department of Public Welfare distributed a letter from Acting Secretary Beverly Mackereth warning leaders of the House and Senate appropriations committees that certain Medicaid funding sources are in question.

Ms. Mackereth wrote that her agency is concerned the U.S. Department of Health and Human Services may reduce the ability of states to leverage Medicaid funding through a tax on managed care organizations. …

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