Potential Budget Savings and Revenue Gains from Medicaid Expansion in Florida: A Snapshot Based on FY 2016-17

Written by Esubalew Dadi and published by the Florida Policy Institute.  Re-published here with their permission.

Executive Summary

A new Florida Policy Institute (FPI) report projects net state budget savings of a half billion dollars if Florida expands its Medicaid program. Under the Affordable Care Act, the state can tap into billions of new federal Medicaid dollars if it opts to cover more than 500,000 low-income uninsured Floridians.

Based on the experiences of other states and FPI’s analysis of FY 2016-17 data, the potential savings and increased revenues far exceed the additional costs that would accompany Medicaid expansion.

Savings and increased revenue would be generated through:

• Enhanced federal matching dollars to continue coverage for the medically needy, adults with disabilities, pregnant women and women with breast and cervical cancer. Currently, the federal government pays 61 percent of every state dollar spent on care for these groups. With Medicaid expansion, the federal match would increase to 90 percent.

• Replacing millions in state General Revenue funds with federal Medicaid dollars to support mental health and substance abuse treatment programs, hospital inpatient costs for prisoners and uncompensated care programs.

• Revenue gains from provider assessments.

Medicaid expansion provides Florida policymakers an unprecedented opportunity to free up state resources that can be used to meet the pressing needs of our families, communities and economy. These include education, workforce training, affordable housing, roads and building sustainability into our coastal communities.

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