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Montana’s Medicaid expansion that widened who can get health coverage is saving the state money. And while Montana’s cost could outpace its spending starting next year, a new report says the program’s boost to the economy will offset the difference and then some.

The University of Montana’s Bureau of Business and Economic Research released the independent analysis today. According to the analysis, even if people signing up for the program plateaus, the expansion will spit out $350 million to $400 million of new spending in Montana’s economy each year.

The Montana Healthcare Foundation and the Headwaters Foundation commissioned the analysis.

“It’s hard to imagine a better picture than being able to cover 94,000 Montanans in a way that actually pays for itself,” said Foundation Chief Executive Officer Aaron Wernham.

The expansion came out of Montana’s 2015 Legislature. It extended coverage to people who made too much to qualify for Medicaid but often too little to cover health care. The federal government picked up most of the program’s tab.

In 2020, Montana is set to begin paying its maximum 10 percent share of the costs. Before that happens, the program will sunset next year.

That’s unless lawmakers do something to stop that when they meet in 2019. And there’s a split largely between Republicans and Democrats as to whether it’s worth the cost.

More people signed up for the program in its first two years than the state predicted would happen by 2020. Some argue that’s good; people are getting care. Others warn that means the expansion will be a larger burden on Montana.

When the program unrolled in 2016, Montana spent $5.3 million toward it with federal dollars covering the rest. In that year, the expansion saved the state $18 million. By 2020, the program is predicted to cost the state nearly $70 million and save another $42 million.

Wednesday’s analysis reported the program puts $270 million back into the pockets of Montanans and creates 5,000 jobs a year.

“The economic impacts of Medicaid expansion are not limited to the jobs and income it directly or indirectly supports,” according to the report. “Medicaid expansion also represents a significant investment in Montanans’ health and well-being, and these investments pay off.”

Bryce Ward, a health economist who helped author the report, said it also looks like the expansion is helping people re-enter the workforce.

Montana’s expansion is largely unique to others in the nation in that it was tied to a program that allows enrollees to opt-into employment assistance.

Following the expansion, labor force participation among low-income Montanans ages 18 to 64 increased by 6 to 9 percent.

“That was a big surprise,” Ward said. “That’s not replicated in other states with the expansion. It shows something is happening that’s different in Montana.”

Ward said it’s too soon to know exactly where that leap came from. He said it could be people are healthy enough to return to work or the program’s job help is actually working.

“The numbers are pretty suggestive,” said Ward, adding it’s something he plans to watch over the next year.

Wernham said the intention behind the report isn’t to predict whether lawmakers will choose to keep the expansion past 2019 but to create the entire economic picture of it’s impact before their decision.

He said one of the biggest things he sees in its findings is that there’s a change in how Montanans take care of themselves. For example, after the expansion, the share of low-income Montanans who skipped care due to cost fell by 16 percent.

“It’s encouraging to see people are getting in for more preventative care,” he said. “It’s very early to have a full sense of the expansion’s impact on health, but we’re going to keep gathering information that’s essential to the public understanding it.”

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Katheryn Houghton can be reached at khoughton@dailychronicle.com or at 406-582-2628. Follow her on Twitter @K_Hought.

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