States that agreed to expand the eligibility requirements for their Medicaid programs under Obamacare are seeing “substantially faster growth” in job creation than states that have resisted that provision of the law, according to a new report.
The drafters of the Affordable Care Act intended Medicaid expansion to be implemented across the country, but the Supreme Court ruled that it should be optional, giving GOP-led states an opportunity to resist the policy. Fifteen states have refused expansion, and an additional seven are considering expanding Medicaid but haven’t yet followed through, according to the Kaiser Family Foundation.
The new study, published by the market trend research group FitchRatings, found that Medicaid expansion states experienced 30 percent faster growth in health sector jobs in 2014, compared to the states that haven’t accepted the expansion.
“The gains in healthcare jobs suggest that ACA expansion is generally positive for that sector’s employment profile,” the report concluded, adding that there’s not yet enough data on the law’s overall impact on other budget issues.
Officials in states across the country have made the economic case for Medicaid expansion. Multiple previous studies have projected that agreeing to accept the expansion could help states create thousands of new jobs in the health care sector to accommodate their growing populations of insured residents.
Plus, since the government will pay up to 90 percent of the tab for the policy over the next five years, states that reject the provision are losing out on that money. Texas, for instance, will forfeit an estimated $9.2 billion in federal funds by 2022 if it continues to refuse to expand its public insurance program. The hospitals in those states are also losing money as a result of cuts that were intended to be offset by the revenue from the expansion, which has forced some of them to close.
In a joint report released by the Urban Institute and Robert Wood Johnson Foundation last summer, the health policy groups concluded that continuing to resist Medicaid expansion would “lessen economic activity and job growth” in GOP-controlled states.
Medicaid expansion has been one of the most successful provisions of the health reform law as it has extended coverage to low-income people who were previously locked out of affordable insurance. States that expanded their programs saw much bigger drops in their rate of uninsured residents — and if the entire country had accepted the expansion, the national uninsurance rate would be two percentage points lower, according to an analysis from the New York Times.
In addition to job creation, research has documented several other potential benefits resulting from extending insurance to additional low-income people — everything from ensuring healthier babies, to helping kids stay in school, to increasing household incomes.
Republican lawmakers eager to push forward with their economic agenda, which is largely predicated upon figuring out how to create more jobs, typically don’t focus on the economic aspects of Medicaid expansion. Instead, they have emphasized what they see as the job-creating potential of a different polarizing policy issue: the construction of the Keystone XL pipeline.