Andrew Sprung at XPostfactoid is doing a great series on the individual states and their performance on Healthcare.gov. His post on Florida generated an interesting insight and one hell of a comment that I want to expand on.
In Florida, 856,092 private plan enrollees — more than half (53.6%) of the total — had incomes between 100% and 150% of the Federal Poverty Level (FPL). That compares with 47% in all states using healthcare.gov that refused to expand Medicaid, and just 22% in expansion states.
Those with incomes in 100-138% FPL range would be Medicaid-eligible if the state had expanded. We don’t know exactly how many there are, but my prior analysis of national enrollment numbers suggests that at least two thirds of the 856k in the 100-150% FPL range are Medicaid-eligible — a bit more than a third of all private plan enrollees in the state (and maybe a good deal more).
In Miami-Dade, the proportion of low-income enrollees is even more eye-popping. Fully two thirds of enrollees — 259,000 out of 392,000 — had incomes in the 100-150% FPL range….
and the very interesting comment:
I am curious about whether an appreciable fraction of the cash influx a state loses by rejecting Medicaid expansion is recovered for the rejecting state in premium subsidies for the 100-138%-ers.
Liberal technocrats have been assuming that the states which refuse to expand are giving up massive amounts of money and thus economic growth by refusing to expand Medicaid will eventually expand. However, are we accounting for the additional cash flow coming in as premium and cost sharing subsidies for people making between 100% and 138% Federal Poverty Line. Brad Delong on Kansas from last fall:
there is one number that I cannot find on either graph or in either version of the policy brief:
That $8 billion is the amount of federal dollars the U.S. government will commit to match 100% of extra costs for the first three years and 90% for the next seven if Kansas expands the Medicaid program as ObamaCare envisions. And that is money that will not flow to Kansas if Medicaid is not expanded by Kansas.
And a more mathed-up Delong post:
The rejectors have 1/3 of the wealth of the nation–call it $5 trillion/year. They are throwing 0.7% of that away to make a political point….In the short-run of our currently-depressed economy we want to apply the within-monetary-union Keynesian multiplier to these flows: Medicaid-rejcting red states are thus making themselves 2% poorer in the short-run. For medical-care hubs like Dallas, Omaha, Atlanta, and Kansas City, the effects are likely to be larger: 3% less in terms of economic activity relative to the baseline, while the Bostons, the Denvers, and the Albuquerques will be on baseline. In the long-run–should they continue this insane and self-destructive policy–we want to apply Enrico Moretti’s long-run regional economic distribution multipliers–which means that we are talking a fall relative to baseline growth of 6% of regional GDP as far as medical-hub cities are concerned.
Does this analysis hold true for all the moving parts of the ACA as a whole?
The cash outflow to the federal government part is a constant whether or not a state expands Medicaid, it is a constant whether or not a state goes on Healthcare.gov or sets up their own exchange. So the cash outflow component is a constant and not worth analyzing. However cash in-flow is dependent in a post-King world only on whether or not they expanded Medicaid.
Now how do the cash flows balance?
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