Guest Post: California Medicaid Predictions Seem On Target

In January 2013 a U.C. Berkeley report (pages 4-5) analyzed what Medi-Cal Expansion would mean to California. Now we can compare some of the predictions to what has happened so far. (The report uses the terms "newly eligible" for what is called "Strict Expansion" in ACASignups (i.e. childless adults ages 19-64), and "already eligible but not yet enrolled" for what ACASignups calls "woodworkers" or "previously eligible.")

Prediction 1: "With the adoption of the Medi-Cal Expansion, we predict...more than 1.4 million Californians will be newly eligible for Medi-Cal, of which between 750,000 and 910,000 are expected to be enrolled at any point in time by 2019."  According to ACA Signups, more than 750,000 "newly eligible" had enrolled by mid-March 2014, including 650,000 moved into Medi-Cal from the Low Income Health Program on Jan. 1.

Prediction #2: "About 2.5 million Californians are already eligible for Medi-Cal but not enrolled. Between 240,000 and 510,000 of these already eligible but not yet enrolled Californians are expected to be enrolled in Medi-Cal coverage at any point in time by 2019."  A Covered California press report says that from Oct. 2013 to April 15, 2014, 1.9 million people had enrolled in Medi-Cal, with 1.1 million coming through the exchange and county offices, 650,000-plus from the Low Income Health Plan and 180,000 individuals applying through the state’s Express Lane program. It is still unclear how many of the 1.9 million were "woodworkers", i.e., already eligible but not enrolled.

Prediction #3: "New state Medi-Cal spending will be largely offset by increased state tax revenues and savings....Billions in new federal dollars will result in new state General Fund (GF) tax revenue which will offset some or most of new state spending, depending on the year." This counters the governor's claim that unexpected high enrollment in Medi-Cal is the reason the state must shortchange other social programs.

Prediction #4: "As uninsured Californians enroll in Medi-Cal under the Expansion, the state could incur substantial savings in other areas of the budget, including other state health programs, mental health services, and state prisons. Most of these General Fund savings result from the expansion of Medi-Cal coverage.... With the Expansion, the magnitude of these anticipated savings would likely be more than enough to offset the $46 to $381 million in annual state General Fund spending for the newly eligible population through 2019."

Prediction #5: "The Medi-Cal Expansion and enrollment growth among those already eligible is predicted to bring between $2.1 and $3.5 billion in new federal Medi-Cal dollars to California in 2014, growing to between $3.4 and $4.5 billion in 2019.  New state General Fund spending for Medi-Cal will be between $188 and $453 million in 2014 and only slightly higher in 2015 and 2016...mostly due to increased enrollment of those currently eligible but not enrolled....In 2019, the new state General Fund spending for Medi-Cal will be between $443 and $788 million, which includes spending for both the newly eligible and those eligible today but not enrolled." The report also states: "The federal government will pay all of the medical costs for the newly eligible enrollees during these years. Administrative costs for the newly eligible are estimated at 5 percent of medical costs: the state will be responsible for half of that, or 2.5 percent."