See running total of how much money Mississippi is turning down by not expanding Medicaid

Mississippi would receive an additional $2.04 billion the first year Medicaid was expanded to provide health care coverage for the working poor, according to projections compiled in June by the state’s University Research Center.

Based on that projection, Mississippi Today is unveiling a digital tracker that will run continuously displaying how much money the state is losing in federal funds by not expanding Medicaid. The tracker reflects the amount of money loss per millisecond for the year based on Medicaid expansion beginning on the start of the fiscal year, July 1st.

How much federal funding has Mississippi turned down this year?

The tracker is not exact: The amount of Medicaid money the state receives is based on a number of factors, primarily the health care needs of those covered by Medicaid. Medicaid provides funds to health care providers for rendering medical services to those who qualify for Medicaid.

The state might receive more federal Medicaid funds, for example, during a flu or COVID-19 outbreak because Medicaid recipients would be receiving more health care.

But for the sake of the tracker, it will be assumed the money received over a year – a projected $2.04 billion – would be distributed evenly.

The tracker presumes that Medicaid expansion would begin in Mississippi on July 1 – the first day of a new fiscal year.

It’s also helpful to explain how the University Research Center derived the projection the state would receive $2.04 billion the first year in federal funds for expanding Medicaid.

The bulk of the federal funds would come from taking the projected number of enrollees – nearly 250,000 — and multiplying that number by the estimated $6,139 expenditure per enrollee. The federal government pays 90% of that cost.

Included in that is money the state would receive by moving certain groups of people currently enrolled in Medicaid where the federal government pays 77.3% of the costs to the new expansion population where the federal government pays 90% of the costs.

In addition, the state would receive funds from the federal government paying a tax to the state – a 3% insurance tax on each new expansion enrollee.

And during the first two years of expansion, the state would receive an estimated $335.4 million in new funds the first year of expansion and an estimated $345.5 million in new funds the second year. The funds would be provided to the state as an incentive to expand Medicaid as 40 other states have done.

The amount of the incentive funds to expand Medicaid is derived by adding 5% to the federal match the state receives from the federal government for the traditional Medicaid program. The federal match Mississippi receives for the traditional Medicaid program is 77.3%. In other words, for every dollar spent on Medicaid, the federal government pays 77.3 cents. Mississippi receives the highest federal match for the traditional Medicaid program of any state in the nation because of multiple reasons, such as the state’s high poverty rate. If Mississippi expanded Medicaid, the federal match non-expansion enrollees would go to 82.3% for two years, resulting in $680 million to the state over two years.

After two years, the 5% increase in the federal match for the traditional Medicaid program would go away. With the removal of the 5% enhanced match, the University Research Center projects the total federal expenditure on Medicaid expansion would drop to $1.78 billion in year three.

At that point, if Medicaid is not expanded, Mississippi Today will have to recalculate its tracker.

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