Report: Medicaid Expansion Projected to Cost 90% More Than Original Estimates

UPDATE: Luke Mayville, Co-Founder of Reclaim Idaho did originally respond to our article but for Idaho Dispatch is unclear why his email did not make it to our inbox. Here is his full quote which he sent to us two days after our request for comment and several weeks before our article was posted:

We are in the midst of a healthcare crisis and an economic crisis, with tens of thousands of Idahoans being laid off and losing their health insurance. It shouldn’t be surprising that we’re seeing more Idaho families rely on Medicaid Expansion as a safety net. We’re also seeing that more people than expected were in desperate need of medical attention after being denied access to healthcare for over six years. In a time of so much need and so much economic uncertainty for families, it is unbelievable that Idaho lawmakers are considering cutting Medicaid. Even if recent budget predictions prove to be true, the Medicaid Expansion program will cost less than 1% of the total Idaho budget.

In 2018, Idaho citizens voted to pass “Prop 2” into law, otherwise known as Medicaid Expansion.

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The effort to pass Medicaid Expansion in Idaho was led primarily by Reclaim Idaho. The group spent months on the road gathering signatures to put the proposition on the ballot for Idaho voters.

Proponents of Prop 2 said the state would save money by expanding Medicaid. Opponents of Prop 2, such as the Idaho Freedom Foundation, claimed that the cost would be higher than projected.

The state of Idaho in the meantime had hired the actuarial firm Milliman to give a cost estimate for Medicaid Expansion. The firm estimated in 2018 that Medicaid Expansion would cost Idahoans approximately for FY21 $412 million and FY22 $439 million at a gross cost.

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However, the firm is now projecting that costs will be approximately 94% higher than they originally estimated in the 2018 report.

The new cost estimate by Milliman is over $800 million.

Here is what Milliman states in the report as the drivers (reasons) for the higher estimate:

The largest driver is the higher medical and pharmacy benefit cost PMPM in the emerging experience.

Another significant driver is the revised enrollment projection.

The Milliman report states that they are projecting enrollments to be approximately 7% higher than previous projections.

Idaho Dispatch reached out first to Reclaim Idaho to see if they had a statement on the new report. The group has not responded to our request for comment at this time. (1/21/2021) Note: Mayville responded to our request which you can see above. His email was sent but not seen by Idaho Dispatch. We apologize for the confusion and to Mayville for not getting his quote in the article when it originally ran.

Additionally, Idaho Dispatch reached out to the Senate Minority Leader, Michelle Stennett (D-Ketchum), and the House Minority Leader, Ilana Rubel (D-Boise) to see if they had any comment on the cost projection from Milliman. We have not yet received a comment from either elected official but will update the article if they do respond.

Idaho Dispatch also emailed the co-chairs of the Joint Finance Appropriations Committee to ask what their thoughts were on the Milliman Report. The two individuals we emailed were Sen. Steve Bair (R-Blackfoot) and Rep. Rick Youngblood (R-Nampa.)

Idaho Dispatch received a joint response from Bair and Youngblood to our inquiry by stating that,

Yes, the report is being looked at and will be discussed and reviewed during session.

Idaho Dispatch also asked the Health and Welfare Committee Chairmen if they have had a chance to review the report and what their thoughts were on the new estimate. Rep. Fred Wood (R-Burley) and Sen. Fred Martin (R-Boise) are chairmen of those committees.

If any major changes take place to the Medicaid Expansion program, they would likely go through the Health and Welfare Committee in each chamber.

At this time Idaho Dispatch has not received a comment from either Wood or Martin. If they do respond, we will post their comment in the top of the article as an update.

Finally, Idaho Dispatch did reach out to the Idaho Freedom Foundation who was the primary opponent of Prop 2. Here is what IFF’s Director of Legislative Affairs Fred Birnbaum told Idaho Dispatch,

Medicaid costs in Idaho were on an unsustainable fiscal path before expansion, and now we see from the recent Milliman cost forecast update that the situation is dire. Sadly, nobody has stepped forward to accept responsibility for this disaster and it is time for the legislative leadership to change course. If the costs can’t be reined in, then Medicaid should be returned to a program only for the most vulnerable and not able-bodied adults.

The 2021 Idaho legislative session is now underway and it remains to be seen what, if anything, will be changed with the Medicaid Expansion program.

Do you believe any changes should be made to Medicaid Expansion?

Let us know what you think in the comments below.