The “One Big Beautiful Bill” passed recently by the House of Representatives significantly cuts federal funding for Medicaid. It is uncertain how these cuts will affect the program, but they may impact the Federal Medical Assistance Percentage (FMAP) for the Medicaid expansion population, which is currently set at a 90% federal match.
In light of this possibility, the Health Policy Institute of Ohio commissioned REMI to analyze the state-level and regional economic and fiscal impacts of reversing Medicaid expansion in Ohio. Multiple scenarios were analyzed, including a complete elimination of the state’s Medicaid expansion, and a reallocation of state expenditures to match the increased Medicaid obligation under a range of lower FMAP values. REMI used a regional PI+ economic model of Ohio to ground their analysis.
REMI found that eliminating Medicaid expansion in Ohio would lower employment growth by 53,181 jobs statewide over the next five years. While the health care sector would be significantly affected, the majority of the job impacts would be spread across a wide variety of non-health care related industries, such as construction, administrative support services, and restaurants. There would also be significant decreases in consumer spending and investment activity, leading to an average annual decrease in GDP growth of $7.2 billion through 2030. There would also be reduced state tax revenue growth of $221 million per year on average.
Click here to view the full report commissioned by the Health Policy Institute of Ohio.
Click here to view Health Policy Institute of Ohio’s announcement of this report.
