Medicaid

Harvard Health Wonks Estimate that ObamaCare’s Medicaid Expansion Alone Could Cost Nearly $1 Trillion

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The Congressional Budget Office's official cost estimate for last year's health care overhaul projected that the law would cost a little less than $950 billion over its first decade. About half of that cost came from the law's Medicaid expansion, which was projected to enroll 16 million new individuals in the joint federal-state health care program for the poor and disabled. 

One triiiiiiilion dollars!

But researchers at Harvard University are now warning that policymakers should be prepared for substantial uncertainty about the true enrollment effects of the Medicaid expansion. In a paper published in the journal Health Affairs earlier this week, a team of health economists estimated that, under the law, new Medicaid enrollment could be as low as 8.5 million people, but also as high as 22.4 million people—with additional costs to match. 

While the cost of the beefed-up Medicaid program could be as low as $34 billion a year, they could also be as high as $98 billion, meaning that a full decade of the Medicaid expansion alone could end up costing nearly $1 trillion—more than the entire law was supposed to cost in its first ten year out of the gate. 

The Medicaid expansion is going to require a lot more health providers too: On the low end, the paper estimates a need for an additional 4,500, and on the high end, it projects a need for more than 12,000 new physicians to handle the increased caseload that results from the subsidized access offered all the new Medicaid enrollees. But that may prove daunting given Medicaid's historically low reimbursement rates when compared to Medicare and private insurance. One of the most frequently noted problems with the program is that Medicaid beneficiaries have trouble finding doctors, and end up clogging up emergency rooms instead. 

What accounts for all that potential variation in new enrollment? According to the paper, it's mostly a matter of how much effort the government spends on trying to get people to enroll. "In the end," the researchers write, "Medicaid enrollment will be determined largely by the extent to which federal and state efforts encourage or discourage eligible people from enrolling."

This is a strong sign that the actual enrollment figures will end up at the higher end of the spectrum.

As a jointly run program, some of this will be determined by state governments. But both states and the federal government will have an incentive to ensure that insurance coverage is high under the law. Just look at the proto-ObamaCare reform in Massachusetts, where state leaders and program advocates consistently point to the Bay State's highest-in-the-nation health coverage when pressed about the program's other flaws. 

We also know how the federal government has responded to at least ObamaCare insurance program with low enrollment. When the law's high-risk pool program for the especially difficult to insure turned out to have far fewer enrollees than expected, The Washington Post reported that the Department of Health and Human Service's response was to launch "an aggressive marketing campaign."

ObamaCare's administrators went hunting for additional beneficiaries before. It's safe enough to expect that they'll do the same again. 

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31 responses to “Harvard Health Wonks Estimate that ObamaCare’s Medicaid Expansion Alone Could Cost Nearly $1 Trillion

  1. Good morning reason!

  2. I heard that new Medicaid patients have to wait a year to get a doctor.

    Guess how long they’re gonna have to wait now?

    1. I heard it was a year and a bar of latinum

  3. Are you suggesting that Obama got it wrong about the costs?

    1. This may in fact be the case.

    2. Are you suggesting that Obama got it wrong lied about the costs?

      Fixed

  4. It’s a good thing we have a cerified geenyus running our centrally planned health-care system. Ccan you imagine the problems we’d face if idiots ran it?

    1. Wile E. Coyote- SUPER genius!

      1. ACME Healthcare.

        1. There’s nothing that a swift anvil to the head won’t cure.

          Except then you have a case of acute accordianbodyitis, and there’s no cure for that.

        2. Actually a very apt description, as all the knuckleheads who wanted it suddenly realize there is no geound under them as they ran off the cliff.

          1. geound = ground

        3. Hey, it’s not our fault the dumbass coyote failed to read the disclaimers. They were printed clearly on the bottom of the bill, er box.

  5. But we had to bend the cost curve. Ezra Klein said so.

    1. I heard that we need to thin the herd

      1. Thin the herd’s wealth, you mean.

  6. The Medicaid expansion is going to require a lot more health providers too: On the low end, the paper estimates a need for an additional 4,500, and on the high end, it projects a need for more than 12,000 new physicians to handle the increased caseload that results from the subsidized access offered all the new Medicaid enrollees.

    stand by for a passionately convoluted explanation from the AMA about how we can’t afford to risk America’s health by letting “just anybody” practice medicine.

    It’s better to die on a waiting list than be treated by a nurse practitioner.

    1. Dr. Granny practiced medicine and never killed anybody. She had a double-barrel shotgun and never killed anybody with that either.

      The Beverly Hillbillies is the missing Libertarian metaphor.

      1. Dr. McNinja kills people all the time. But they’re all bad people… mostly.

        He also has super-human strength because he is both a doctor and a ninja.

        We need more doctors like Dr. McNinja.

        1. If he is exposed to gamma rays and grows into a giant, will he be Dr. Big McNinja?

  7. On the low end, the paper estimates a need for an additional 4,500, and on the high end, it projects a need for more than 12,000 new physicians to handle the increased caseload

    This from a paper released this week? Sure glad these Harvard guys tweaked this out in their research. This problem and these kind of figures were only all over the place back when this mutant fetus was aborning. Of course then it was just arbitrary obstructionism coming only from heartless Republicans.

  8. We need more doctors like Dr. McNinja.

    Doctor McNinja can definitely bend the cost curve for the “last mile”.

  9. This is news? Next up, the sky is blue, film at 11!

  10. This is not a bug. This is a feature.

  11. There is an old saying, figures don’t lie but liars figure. This article is a shining example of that maxim. Just a lame attempt to conjure up support for your position with Enron style accounting.

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