U.S. Sen. Jeff Bingaman addressed a little discussed topic that has potentially major consequences for New Mexico at a town hall on health care reform yesterday.
One of the key components of health care reform proposals being debated in Washington right now is a mandate that would require everyone to purchase insurance. Given that about half of New Mexico’s uninsured population is currently eligible for Medicaid, this means that Medicaid enrollment in the state would swell.
Right now, the federal government pays for about 75 percent of the cost of health care for Medicaid recipients in New Mexico. The state pays the rest. A significant expansion of enrollment would therefore require the state to pay a significant amount more than it does now — in spite of today’s looming Medicaid shortfall.
New Mexico’s eligibility for Medicaid is already higher than the federal eligibility rate, and more outreach in the past might have already brought many of those people onto the rolls. So in some respects, a mandate would simply propel people who are already eligible for Medicaid to sign up.
Nonetheless, given the strapped state budget and the targeting of Medicaid by some in state government as an area to wring savings, the potential for a massive expansion of enrollment has huge ramifications for the state.
Bingaman sought to assuage these concerns at the town hall, albeit in a very vague way.
“The issue of whether there will be additional burdens on the states hasn’t been decided,” he said. “With this expansion, clearly the federal government would pay the lion’s share, but the decision of what percentage has not been made.”