Thursday, November 19, 2009

Health Insurance Reform Proposals Are a Bargain Not a Bust for Georgia

Leading health insurance reform proposals to expand Medicaid that are making their way through Congress not only could cover one million low-income Georgians, but will provide more than 90 percent of the funds to do so.

This is a win-win for all Georgians, as explained in the Georgia Budget & Policy Institute's latest analysis. Both Governor Perdue and Lt. Governor Cagle's have overstated the budget impact and neglected to state that the federal government is not only picking up most of Georgia's tab, but that local economies will benefit from the healthcare dollars as well as healthier citizens.

The governor and lieutenant governor are both using out-of-date cost estimates when stating that Georgia cannot afford the reform proposals to expand Medicaid. In addition, both fail to apply these basic principles to their analysis:

1) Participation will ramp up over a few years and cannot practically happen the first day the expansion takes effect.
2) Full participation in the expanded Medicaid program may never occur.
3) Federal dollars will pay the full cost for two to three years, and then 90 percent of it after that.

"There is plenty of time to ensure the state has adequate funds to provide coverage to the lowest-income Georgians without access to health insurance, since neither proposal starts for a few years," said Timothy Sweeney, the Institute's senior healthcare analyst, "and even when the law does go into effect, those eligible will sign-up over another several years, not all at once.

"Another reason that expanding Medicaid is a bargain not just for Georgia, but for all the states, is that in addition to getting its citizens covered, it injects millions of federal funds into local economies," said Sweeney, the report's author.

Georgian's needs are growing dramatically and the state's ability to meet them are shrinking. Georgia's uninsured rate is tenth in the nation. Roughly one in seven people lived in poverty in 2008, and our job loss rate is fifth in the nation. Vulnerable groups are hit hardest during recessions, and low-income workers are losing employer-sponsored health insurance faster than others.

The analysis also explains why both houses of Congress are choosing to expand Medicaid, and how each bill funds the expansion with federal funds.

The Georgia Department of Community Health is currently reworking their cost estimates based on current reform proposals that have been passed in Congress. "The state's highest leaders should use accurate numbers and not scare people into believing the state cannot afford to expand coverage to those with the least access to healthcare," said Alan Essig, the Institue's executive director.

"In fact they have it backwards, the state cannot afford not to take advantage of this incredible opportunity to insure its neediest citizens."

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