- Associated Press - Sunday, July 19, 2015

More than a dozen states that opted to expand Medicaid under the Affordable Care Act have seen enrollments surge way beyond projections, raising concerns that the added costs will strain their budgets when federal aid is scaled back starting in two years. At least seven of the states have increased their cost estimates for 2017, according to an Associated Press analysis of state budget projections, Medicaid enrollments and cost details in the expansion states.

Here’s a look at the expansion in New Jersey:

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THE DEAL

Medicaid is a partnership between the federal government and states that provides health insurance for low-income people.

As part of President Barack Obama’s health insurance overhaul, the U.S. was offering to pay for program’s expansion to cover adults with higher incomes. But starting in 2017, states have to pay a portion of the expansion cost.

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THE DECISION

New Jersey Gov. Chris Christie went for the expansion back in 2013, though he made clear he did not like the underlying policy.

“Let me be clear, I am no fan of the Affordable Care Act. I think it is wrong for New Jersey and for America,” Christie said at the time.

Christie, a Republican who is now seeking his party’s 2016 presidential nomination, says he wants to turn Medicaid into a block grant program to states, a move that could reduce its benefits over time.

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THE EXPANSION

More people have taken advantage of the expanded eligibility for Medicaid than New Jersey expected.

A state-commissioned Rutgers University study had anticipated 234,000 more people on Medicaid. In May, the number of newly eligible people in the program was nearly 383,000.

The state says it expects the enrollment to continue to grow and that its share of the cost next year will be $162 million.

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THE BENEFIT

As Christie rolled out his state budget proposal earlier this year, his treasurer praised the expansion, saying it’s been “a blessing for providing appropriate care to our most vulnerable populations.”

In the budget, the state cut charity aid to hospitals for providing care to uninsured patients to $502 million from $650 million, saying the Medicaid expansion was responsible for about half of the reduction.

That cut alone would pay for most of the state’s costs next year for the expanded Medicaid program.

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OTHER POSSIBLE SAVINGS

Raymond Castro, who studies health policy for the liberal think tank New Jersey Policy Perspective, says the Medicaid expansion is good for the state government’s finances in other ways because it’s generating more economic activity and making savings in areas such as the Corrections Department and mental health programs.


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