Damages from Medicaid Politics Won't Stop at Hospitals

John Commins, for HealthLeaders Media , July 3, 2013

Those cuts, which are included in the ACA and the Budget Control Act, combine to reduce Missouri hospital reimbursements by $4 billion through 2019. Another study from Mizzou found that Medicaid expansion would create more than 22,000 jobs.

Try to imagine the ripple effect of punching a $4 billion hole in the state's economy. It's not just hospital jobs. It's ancillary support jobs in healthcare and other businesses. It's less money spent in the supermarket in town, or the local café, or the hardware store, or the car dealership. It's money taken out of circulation that otherwise would have been spent locally.

So how will this all play out?  

"Hospitals will reduce some services, there will be jobs eliminated and the worst-case scenario is some hospitals are going to close," Zechman says. "They will be the only providers in those rural communities and generally speaking they are the No. 1 employer in those communities. From an economic perspective it is going to kill those local communities."  

Skeptics will point out that the MHA and Zechman have an interest in painting as bleak a picture as possible. That's a fair point. But what if we cut their estimates in half? See what happens when you take $2 billion out of the local economy. The effect is still daunting. Zechman calls the case for Medicaid "overwhelmingly compelling." He's right.  

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