South Dakota’s budget crunch is coming in part because of increased enrollment and costs in Medicaid. It’s funny, then, that South Dakota is trying to block one way to fix that fiscal problem: the Patient Protection and Affordable Care Act. As Matthew Blake at Understanding Government reminds us, come 2014, Washington will pay 100% of Medicaid for folks earnign less than 133% of the poverty level. States resume paying 10% of that share in 2019, but that’s still a healthy break from the 40-50% share states currently shoulder for all patients.
Blake points to John Bouman’s summary of three studies that say states will enjoy significant savings thanks to the PPACA:
- The Urban Institute calculates increased costs and savings and finds in the worst case, the states save $40.6 billion from 2014 to 2019. In the best case, the states save $131.9 billion.
- The White House Council of Economic Advisers looked at sixteen states last year (not South Dakota—darn!) and estimated nationwide, states would save $11 billion by reducing the insurance premiums they currently pay on their employees to cover care for the uninsured.
- The Lewin Group found PPACA saving the states and Uncle Sam money. States could save over $6 billion in small change between now and 2014 and $106.8 billion in real money over the whole decade.
Instead of waging futile lawsuits against the PPACA, governors should be begging Washington to kick this plan into gear sooner!
But remember, Kristi Noem is determined to repeal this legislation next month… and thus guarantee that the Daugaard administration sustains the Rounds structural deficit until Matt Michels or Dusty Johnson takes the helm in 2018.