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UNM Economist Touts Medicaid Jobs for State

ALBUQUERQUE, N.M. — Accepting billions of federal dollars beginning in 2014 to extend Medicaid benefits to low-income adults could generate as many as 10,000 new jobs a year in New Mexico, a University of New Mexico economist told the Economic Forum on Wednesday.

“We should seriously consider saying ‘yes’ to Medicaid expansion,” said Lee Reynis, director of UNM’s Bureau of Business and Economic Research. “It’s a chance to develop health-care infrastructure in the state, especially in rural areas.”

Under terms of the Affordable Care Act, the federal government for three years beginning in 2014 will pay the cost of extending Medicaid benefits to adults earning 133 percent of the federal poverty level. The states that agree to extend benefits would pay 10 percent of the cost thereafter.

The state Human Services Department estimates that over a six-year period up to 170,000 adults would receive Medicaid benefits if the program is expanded. The state would pay up to $500 million in the period and receive up to $6.2 billion in federal funds.

Reynis said BBER estimated “conservatively” that New Mexico would receive $3.9 billion from the federal government from 2014 to 2020. Its forecasting models showed Medicaid expansion would create 1,500 new jobs in the health-care sector in 2014 and 5,000 in 2020. Spending by these newly employed people would generate new economic activity resulting in more new jobs, she said. BBER forecast up to 10,000 new jobs a year would be created.

Earlier this summer, economists with New Mexico Voices for Children estimated that if federal spending reaches $6.2 billion, 9,910 new jobs will be created in 2014, with that number increasing annually until it hits 38,792 in 2020.


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The governor has yet to tell federal officials whether New Mexico will expand Medicaid.

BBER forecasts that the state and Albuquerque economies will grow but at historically slow rates. State employment should grow 0.7 percent this year, 1.2 percent next year, 1.3 percent in 2014 and 1.6 percent in 2015, Reynis said. Albuquerque job growth should be 0.2 percent this year, 1.3 percent in 2013 and 2014 and 1.7 percent in 2015.

The private sector has been hiring, but government employment has taken deep cuts, Reynis said. BBER forecasts that if more federal spending cuts, known as sequestration, take effect Jan. 1, New Mexico will lose 20,000 jobs.

Economic Forum is a non-partisan business leaders group founded in 1982 that is funded entirely by membership dues. Members meet regularly to discuss public affairs and to learn about issues and community activities.
— This article appeared on page A1 of the Albuquerque Journal