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State dramatically revises Medicaid expansion estimate amid criticism

What a difference a day and a few assumptions make.

On Tuesday, Gov. Rick Scott's office defended a questionable Dec. 17 report that Florida taxpayers would be on the hook for nearly $26 billion over 10 years to expand Medicaid as part of President Barack Obama's health care plan.

Late Wednesday, Scott's Agency for Health Care Administration released a revised estimate.

The new 10-year cost? $3 billion.

Why the enormous difference?

The new estimate includes the federal matching funds promised in the health care law to pay for the Medicaid expansion. It also excludes costs associated with people who are now eligible for Medicaid but for one reason or another have not enrolled. The revised estimate is more in line with costs estimated by outside groups, and could soften attacks that the expansion is too costly for Florida to afford. With some other changes, the estimate could climb to about $5 billion.

Scott had used the eye-popping $26 billion estimate to make a case against the health care law both on Sunday in a Tampa Bay Times guest column and again on Monday after a meeting with Health and Human Services Secretary Kathleen Sebelius.

But the dollar-figure was quickly debunked as based on severely suspect assumptions and was panned by Democrats, health care advocates and even a prominent Republican lawmaker.

On Wednesday, House Appropriations Chairman Rep. Seth McKeel, R-Lakeland, released a subtle but unmistakable jab at the original veracity of the estimate.

While "it is important to recognize the potential state financial exposure should the federal laws change for the worse," McKeel wrote, "we must follow our process which requires estimates based on current law and practice. This is critical to the integrity of our budgeting process."

Scott's office had defended the original $26 billion estimate Tuesday, arguing that while the federal health care law promised additional Medicaid funding, it might not actually come.

The plan to expand Medicaid, the government-run health insurance program for the poor, is a key but optional part of Obama's health care law.

States, which manage the program, can decide whether to expand the program or not, but to make the option enticing, the federal government offered to pick up most of the costs to cover more people.

While the federal government is paying about 58 percent of the costs for current Medicaid recipients, it has agreed to pay 100 percent of the costs for newly eligible Medicaid recipients from 2014-16. The federal government would cover 95 percent of the costs in 2017, 94 percent in 2018, 93 percent in 2019 and 90 percent in 2020 and beyond.

State dramatically revises Medicaid expansion estimate amid criticism 01/09/13 [Last modified: Wednesday, January 9, 2013 11:08pm]
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