According to the Kaiser Family Foundation twenty one states
are not moving forward with Medicaid expansion either due to their governor’s
opposition, a legislative body’s opposition, or both. For example, the
Wisconsin State Legislature recently voted to reject Medicaid expansion, while
neighboring state Minnesota is moving forward with the expansion. The expansion
is expected to save Minnesota $120 million over the next two years, while
extending Medicaid to an additional 130,000 citizens. Meanwhile, Wisconsin, by
refusing the expansion, is neglecting to provide coverage for 85,000 people who
fall below 133% of the Federal Poverty Level mandated by the PPACA. Could
Minnesota’s expansion potentially benefit low-wage earners in Wisconsin as well
and what effect will it have on the Wisconsin economy overall?
Examining the effect that Massachusetts Medicaid Expansion
to single adults had on the Rhode Island economy it becomes apparent. When
Massachusetts passed MassHealth, which included Medicaid expansion to single
adults living within 150% of the Federal Poverty Level, Medicaid enrollment
increased by over 5% above the national average at its inception and continued
increasing between 1% and 2% above the national average over the next three
years according to the Centers for Medicare and Medicaid Services. Upon
examination of Medicaid enrollment in the neighboring state of Rhode Island at
this time we see Medicaid enrollments 6% annually below the national average
during the same period, until the decline began tapering off in 2009. Rhode
Island Medicaid does not currently enroll single adults, (they will begin doing
so next year under the PPACA).
Did low wage earners in Rhode Island realize a good thing in
2006 when they saw the introduction of MassHealth and move? If so, rather than
being detrimental wouldn’t this have been beneficial to Massachusetts economic
recovery though the addition to its labor pool for manufacturing and service
jobs? According to the Bureau of Labor Statistics, last April Massachusetts
posted a jobless rate of 6.4%, significantly lower than the national jobless
rate of 7.5%, while Rhode Island with a jobless rate of 8.8% was significantly
higher. Massachusetts' unemployment
level was well below the national average in 2006 when Medicaid was expanded to
include single adults, and remained below the national average during the
entire recession despite the enrollment.
While the Census bureau shows that Massachusetts’ population
did not increase above the national average during this period, it did increase
percentage wise more than any other New England State. Additionally, while
Rhode Island had already begun a slight population decrease in 2003 we see the
population decrease markedly after the introduction of Mass Health, (from
1,071,414 in July of 2004 before Medicaid expansion was announced, to 1,052,219
in July of 2009, a total of -1.73%). In fact, the only Massachusetts border
state where population decreased at this time was Rhode Island. Notably as
well, according to the Census Bureau, we see the Median Annual Income of
Massachusetts residents decrease by 1.25% from 2005 to 2006, while we see the
Median Annual Income of Rhode Island residents increase by 7.9%. It seems
plausible that many of the mobile Rhode Islanders ended up in Massachusetts;
however, did they do so for healthcare reasons? Newspaper and magazine articles
at this time were actually encouraging people to move to Massachusetts in order
to gain health care, so it seems likely that many of the low-wage earners ended
up there.
Rhode Island’s largest city, Providence, lies just over the
Massachusetts border. In fact the population of the greater metropolitan area
of Providence is larger than the population of the state due to the inclusion
of Massachusetts residents. It would seem to be quite easy for a low wage
earner, especially a single adult, to move less than five miles in order to
gain health insurance. Additionally, according to the Center for Economic
Advancement, Rhode Island saw the greatest increase in poverty in the nation
during the recession, from 10% in 2006-2007 to 12.9% in 2008-2009; could this
have potentially been much worse? Are businesses in Minnesota primed to receive
an abundant supply of low wage earners that come equipped with
federally-supplied health care and won't this eventually support expansion of
businesses throughout the state?
If two single adults were working for the same low wage at
the same business, one living in Rhode Island without coverage and the other in
Massachusetts with coverage, wouldn't the worker without coverage move at the
first opportunity especially if they could maintain their position? It is a
common occurrence for people who live on a border to take jobs in their
neighboring states, employers in Massachusetts regularly employ people who live
in Rhode Island. As Rhode Island at this time didn't have Medicaid coverage for
single adults, and as this population was most dramatically effected by the
change in Medicaid enrollment it would seem to make sense that workers left the
state, especially in light of the 2013 Kaiser Family Foundations June tracking
poll where the value young adults place on healthcare is illustrated:
http://kff.org/health-reform/poll-finding/kaiser-health-tracking-poll-june-2013/
It appears highly unlikely that some states are going to
expand Medicaid as there is no mandate to do so, by not doing so, their border
states will reap the same economic gains through the PPACA’s Medicaid Expansion
that Massachusetts did.
Expansion makes good sense for businesses, especially those
employing low-income workers and it makes good sense for the workers in these
positions as well, especially as businesses are unlikely to offer affordable
healthcare to their employees and are not mandated to do so until 2015. We have
already seen that many businesses would rather reduce hours than give their
workers heath benefits. Once one state has this economic advantage they are
going to maintain it, a young workforce will move to a border state for a benefit
as important as health care, it would be doubtful that they will move back for
no obvious advantage and many of the available jobs will have already crossed
with them. It will be interesting to watch the economies of the early adopting
Medicaid expansion states unfold in comparison to their border states that
chose not to increase Medicaid enrollment.
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