ObamaCare will Dramatically Increase Medicaid Costs in PA

A reader asked us what kind of effect ObamaCare would have on Medicaid costs in Pennsylvania. We’ve put together some numbers, and it’s not pretty.

First of all, even without the recent health care overhaul Medicaid in Pennsylvania is unsustainable. Presently, Medicaid consumes 21% of the state budget. Even without ObamaCare’s added costs, the program would have consumed 95% of the state general fund by 2075—despite millions in federal subsidies.

In the first year of the program (2013), states must enroll anyone who earns less than 133% of the poverty level. In other words, a family of four making less than $29,000 would be eligible for Medicaid. Heritage estimates that this will increase PA’s Medicaid enrollment by 453,749 to a total of 3,036,729 in 2014 (an increase of 17.6%).

At first, the federal government will pay for all of the costs of the Medicaid expansion. But, starting in 2017, the state will gradually pay more of the extra cost, up to 10%. States will also receive a small increase in its matching federal grant to cover Medicaid costs.

Overall, Pennsylvania will be among the hardest hit, as the Commonwealth will be forced to raise eligibility levels. Pennsylvania Medicaid costs from 2014 through 2020 are estimated to increase by $841.2 million as a result of the new mandates.

On top of all this, a growing proportion of seniors are scamming the system by artificially impoverishing themselves to qualify for long-term care Medicaid assistance.