Brown is bluffing, right?
If not, he’s got his figures wrong on Medi-Cal expansion
We assume Gov. Jerry Brown was bluffing last week when he told The Associated Press that he was holding back on expanding the state’s Medi-Cal program, as allowed by the Affordable Care Act, because it would be too costly.
Expanding the program could increase costs by up to $4 billion a year, Brown told the AP, potentially putting the state’s budget “right out of whack” if current fiscal-cliff negotiations aren’t resolved favorably. He said his administration is seeking federal waivers for some of the proposed Medi-Cal expansions.
The governor’s as tight as a tick, so it’s no surprise that he’s trying to squeeze the feds for all the money he can get. But the feds already are committed to paying most of the cost, starting at 100 percent for three years beginning in 2014, then dropping gradually to 90 percent by 2020. According to a report from the Kaiser Family Foundation, the state’s cost is projected to account for only 1.7 percent of Medi-Cal spending over the next decade, for a total outlay of $6.3 billion. That’s a lot less than the $4 billion annually the governor mentioned.
For that $6.3 billion investment, the state could enable an additional 1.9 million people, those earning up to 138 percent of the federal poverty line (currently $15,415 a year), to obtain affordable health care in 2022 alone. It would also bring nearly $69 billion in additional federal dollars—11 times the state’s investment—into the state’s economy over the next decade.
Financially, and also from a health-care standpoint, that’s just too good to pass up. We hope the governor is bluffing.