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Hospital-funded study: Medicaid expansion has huge economic, health impact in Montana

Posted at 4:01 PM, Mar 26, 2019

HELENA — Montana’s Medicaid expansion, which covers 96,000 low-income adults, has had a huge economic and health-care impact on the state, creating thousands of jobs and greatly lowering the number of uninsured people, says a study released Tuesday by Montana hospitals.

The study, released hours before a House committee planned to vote on bills to continue the Medicaid program, also compared Montana’s program and health impacts to neighboring states, including those that have not expanded Medicaid to cover poor, able-bodied adults.

“Medicaid expansion is improving health outcomes, creating a healthier workforce and saving Montana businesses millions in health-care costs,” said Rich Rasmussen, president of MHA, the lobby group representing Montana hospitals. “Medicaid expansion is contributing to billions of dollars in positive economic activity in Montana and, in a nutshell, Montana Medicaid works.”

The study by Navigant, an international consulting firm, focused on the program’s first two-and-half years in Montana, from 2016 through mid-2018. Its findings include:

• The program spent $1.24 billion during that time period, with $693 million coming in the final full year of fiscal 2018. Of that total, the federal government covered $1.17 billion, leaving about $70 million to be covered by the state and premiums paid by some of those covered.

• The expansion has led to an additional $2 billion of economic activity in Montana, using a common economic multiplier effect. It supported or created an additional 9,700 jobs during that time period and nearly $800 million of associated wages.

• About 84 percent of Montana private-sector workers have at least one co-worker who was covered by expanded Medicaid in 2017.

• In fiscal 2017, about 8 percent of Montana’s population was covered by Medicaid expansion — about the same as Washington and Colorado, but less than Oregon (10.8 percent) and more than North Dakota (2.7 percent). South Dakota, Wyoming and Utah did not have expanded Medicaid that year.

• Montana’s rate of people without health insurance dropped 56 percent from 2013 to 2016, in large part because of Medicaid expansion. The only other state in the region with a higher percentage drop was Oregon, at 58 percent.

• Montana hospitals saw a $270 million increase in Medicaid net-patient revenue from 2015 to 2017.

Roshni Arora, Navigant Consulting

Roshni Arora, Navigant’s lead researcher for the study, said Medicaid expansion also has had a “very positive impact” on Montanans’ access to health care, leading to an increase in the use of prevention services, diagnoses of chronic diseases like diabetes, and treatment of substance-use disorders.

The Montana Legislature voted in 2015 to expand Medicaid, but the program is set to expire this June, unless lawmakers vote to extend it.

The House Human Services Committee planned to vote late Tuesday on a pair of bills to continue the program.

One of those bills — House Bill 658, sponsored by Rep. Ed Buttrey, R-Great Falls — would add some restrictions to eligibility for the program.

Rasmussen said hospitals, which are supporting both bills, hope that lawmakers will extend the program with “minimal disruption to our patients.”

“We’re hopeful that what they advance forward, in a bipartisan way, will provide minimal risk to anyone who is in the program today,” he said.