Healthcare reform to save states $100B

July 11, 2011 at 4:53 PM
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PRINCETON, N.J., July 11 (UPI) -- State governments are likely to save $92 billion to $129 billion from 2014 to 2019 as a result of the Affordable Care Act, two U.S. non-profits say.

Matthew Buettgens, Stan Dorn and Caitlin Carroll of the Robert Wood Johnson Foundation and the Urban Institute used their Health Insurance Policy Simulation Model to estimate federal and state spending and savings as healthcare reform increases access to healthcare.

Thanks to provisions designed to reduce the uninsured population and increase federal support for healthcare functions previously financed by states as more Americans gain access to affordable healthcare, state spending on additional Medicaid enrollees will rise by $80 billion but be offset by $66 billion in new federal spending on existing Medicaid enrollees, the report says.

This results in $14 billion in net state Medicaid cost increases from 2014 to 2019, the report says.

The elimination of Medicaid eligibility for certain adults with incomes above 138 percent of the federal poverty level will save states an additional $69 billion, the report adds.

The report also says:

-- Spending on uncompensated care (people with no insurance) would fall 12.5 percent to 25 percent, saving the federal government $39 billion to $78 billion and states $26 billion to $52 billion.

-- Expanding federal Medicaid coverage of the mentally ill will save states some $11 billion to $22 billion.

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