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Medicaid Expansion Passes Senate, Headed Back to House

After waiting through the summer for the Michigan Senate to vote on Medicaid reform, supporters, including the Detroit Regional Chamber were finally able to declare victory, as the Senate passed the bill with a 20-18 vote this week. The bill, which now heads back to the House, would expand coverage to approximately 300,000 individuals at 133 percent of the federal poverty line.

Expanding Medicaid allows Michigan to lower health care costs by reducing the level of uncompensated care, and encouraging low-income individuals to pursue care from a primary care physician instead of the much costlier emergency room. It also puts into place key reforms that will allow for greater cost-sharing and increased incentives for Medicaid participants to adopt healthy behaviors. The expansion also will help keep business’ health care costs in check by reducing levels of uncompensated care.

The expansion will be paid for by the federal government for the first three years and they will pay 90 percent in the years after. Estimates from the University of Michigan indicate that these savings will more than pay for the increased financial expectations of the state as federal assistance declines.