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IACI: Failure to expand Medicaid would cost Idaho industry millions

Large Idaho employers would face millions in costs if the state declines to expand its Medicaid program, according to a new report from the Idaho Association of Commerce and Industry. "For us, it's a business-numbers issue," IACI President Alex LaBeau told Idaho Statesman reporter Audrey Dutton. "It's pretty clear from the information and the numbers that Medicaid expansion would save industry a lot of money."

Dutton reported on IACI's findings over the weekend; click below for a full report from the Statesman and The Associated Press. Idaho Gov. Butch Otter convened a working group a year ago that studied the issue and recommended expanding Medicaid, but only if the move is accompanied by reforms in the program; Idaho took no action this year, but still could. The working group found that the state, counties and Idaho property taxpayers would save hundreds of millions if Medicaid were expanded; the move, initially 100 percent federally funded then scaling back to 90 percent, would replace the state's current medical indigency program, which is 100 percent funded by county property taxes and the state general fund.

Association: Medicaid expansion could cut costs

BOISE, Idaho (AP) — A decision by Idaho lawmakers not to expand Medicaid to cover more low-income residents will cost $12.3 million to $18.5 million a year in penalties for large companies that don't insure their employees, an Idaho pro-business lobbying group said.

The Idaho Statesman reports ( that the Idaho Association of Commerce and Industry also said not expanding Medicaid will cost an unspecified amount for businesses whose insurance and taxes subsidize care for the uninsured.

"For us, it's a business-numbers issue," said IACI President Alex LaBeau said. "It's pretty clear from the information and the numbers that Medicaid expansion would save industry a lot of money."

Idaho lawmakers earlier this year approved a state-based health insurance exchange that's part of President Barack Obama's health care overhaul. But lawmakers balked at the idea of Idaho expanding Medicaid, a provision in the Affordable Care Act approved in 2010 that a U.S. Supreme Court decision made optional.

Gov. C.L. "Butch" Otter opposes expanding Medicaid, at least until he wins reforms to boost patient responsibility.

About 1 in 13 Idaho workers make the minimum wage of $7.25, making Idaho the state with the largest share of minimum-wage employees in the nation. Many of those workers have jobs that don't offer insurance and can't afford to buy insurance themselves. Under the federal law, businesses with 50 or more full-time equivalent employees would have to decide between offering them insurance or paying fines.

But if those employees qualify for Medicaid, the businesses would be off the hook. The IACI estimates large employers could save millions if their lowest-paid employees enrolled in Medicaid.

The federal government would initially pick up 100 percent of the cost of caring for an estimated 100,000 additional low-income people that would be added to the Medicaid rolls in the state. Idaho would be required to pick up 10 percent of the cost starting in 2020.

The IACI said that large business not offering health insurance to employees would face a tax penalty of $2,000 per person. The group also predicts higher insurance premiums when hospitals shift costs of uninsured patients to insured patients.

LaBeau said the lobbying group hasn't decided how to use its findings, but has presented them to Otter.

"As you know, a team led by Health and Welfare Director (Dick) Armstrong is continuing to assess all the issues surrounding Medicaid in Idaho," said Otter's spokesman, Mark Warbis, in an email to the newspaper. "It's too soon to draw any conclusions about our path forward."


Information from: Idaho Statesman,

Copyright 2013 The Associated Press.

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Betsy Z. Russell
Betsy Z. Russell joined The Spokesman-Review in 1991. She currently is a reporter in the Boise Bureau covering Idaho state government and politics, and other news from Idaho's state capital.

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