LETTER: Incorrect Medicaid Calculations

By Beacon Staff

Recently a column in the Flathead Beacon (“Free Stuff, Isn’t”) raised the question of whether or not expanding Medicaid to 70,000 low income Montanans is worth the cost. Simply put, yes, expanding Montana’s Medicaid program would strengthen our economy, create jobs and help thousands of Montanans access the health care they need.

The column cited a recent report by Montana Budget and Policy Center (MBPC) that notes Montana is missing out on millions of dollars every day we wait to expand Medicaid – $1.84 million in federal funding, $1.3 million in labor income, and $135,000 in state and local taxes are lost each day. Additionally, Medicaid expansion would bring 12,000 new jobs to the state. After noting this, however, the columnist Dave Skinner mistakenly claims the jobs created by expansion would net salaries of only $27,000 a year.

Skinner arrives at his calculation incorrectly. He divides the $1.3 million lost in labor income figure by 12,000 to show the wages earned a day per worker – $108. Then, however, he incorrectly multiplies this number by 250 – the number of working days in a year, not 365 – the number of actual days in a year.

MBPC determined the lost, daily labor income figure of $1.3 million by dividing the total amount of labor income Medicaid expansion would generate in 2014 by 365, not by 250 as Skinner assumes. Using his methodology, he should have concluded the jobs created would have an average salary of $39,500 – a salary significantly higher than his estimate, and significantly higher than that of the average Montanan job ($35,000). In fact, as the commissioner of securities and insurance reports, jobs in the health care field have an average salary of $42,000, which is quite a nice living in the Big Sky state.

The 12,000 jobs created by Medicaid expansion will, in fact, be good paying jobs that will help strengthen our state’s economy.

More importantly, however, Skinner forgets to note the cost of not expanding Medicaid. In addition to the costs of uncompensated care that Montana taxpayers are already shouldering, we are paying the cost in other ways. The cost to workers who can’t find employment, the cost to our health care providers and rural clinics, the economic loss to our communities, the cost to Montanans who can’t receive the health care they need to save lives – these are the true costs of not expanding.

Medicaid expansion will provide quality health care to 70,000 of our friends and neighbors, preschool teachers and working parents, not to mention 9,500 veterans and their families.

All Montanans benefit from a healthy and thriving state. Foregoing an opportunity to strengthen our communities is the true cost of not expanding Medicaid, and a risk we can’t afford. It’s time to expand Medicaid in Montana.

Jackie Semmens, policy analyst
Montana Budget and Policy Center

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