Mississippi and Medicaid: The Small Business Perspective

Publisher: 
Small Business Majority
Date: 
Wednesday, May 22, 2013

When the Affordable Care Act was signed into law in 2010, it delivered sweeping reform to the nation’s healthcare system. A significant feature of the law is an expansion of Medicaid to cover a larger number of low-income individuals. In June 2012, the Supreme Court ruled it was up to each state to decide whether to expand eligibility for Medicaid. Medicaid expansion gives every state the opportunity to take advantage of federal funding that will support jobs and stimulate economic growth while expanding health coverage. For Mississippi small business owners, additional federal dollars flowing into the state that will then be recirculated to their businesses, boosting their bottom lines and helping them create more jobs.

Key Findings

An expansion will level the playing field for Mississippi’s small businesses: Medicaid expansion would cover about 300,000 additional people, most of them low-wage working adults. Because so many working adults would qualify for Medicaid, small businesses that cannot afford to offer their employees health insurance would be better able to compete for workers with big businesses that can offer health insurance.

Medicaid expansion will stimulate Mississippi's economy: Just like a new factory or federal construction project, Medicaid expansion will pump new money into the economy. This will bring an estimated $8.6 billion additional federal dollars to Mississippi between 2014 and 2020, and the economy will generate nearly $257 million in cumulative additions to State General Fund revenue. That money will be spread among all the state’s counties. It will increase incomes for all types of healthcare service providers, including hospitals and their employees, doctors and nurses, nursing homes and medical suppliers. Between 2014 and 2020, the jobs created by the expansion would add $673.8 million in labor income.

Medicaid expansion will help reduce the ‘hidden tax: When someone without insurance seeks medical care they can’t pay for, the state or a charity may pick up some of the cost but the balance remains unpaid. To cover it, insurers charge higher rates when the insured receive care, and these increases get shifted to higher premiums. In 2008, the costs of uncompensated care increased family health insurance premiums by an estimated $1,017. By reducing the number of uninsured people in Mississippi, expanding Medicaid will lower these pass-through costs to insured residents and business owners.

Press Release

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