The credit rating agency Moody’s Investors Service has warned that the decision by Maine voters to expand Medicaid might make it more difficult for the state to keep its budget balanced.
Voters decided they wanted Maine to expand Medicaid to some 70,000 citizens in a public referendum on Tuesday. The state joins 31 other states in doing so, but it’s the first to expand via a public vote, despite criticism of the move from Republicans such as Gov. Paul LePage.
Moody’s released a report on Wednesday that said the move “may increase budget pressure for the state.” The expansion will increase the state’s Medicaid costs by at least $55 million by the time it’s fully implemented in 2021, reported Moody’s, a New York-based business considered one of the “Big Three” credit rating agencies.
The state could also face risk based on what happens at the federal level, the agency stated.
“The larger risk to the state is that the federal government could reduce Medicaid funding,” the agency said in its statement. “If funding for the federal expansion program is cut or eliminated, Maine would face budget pressure if it decides to maintain similar levels of coverage.”
LePage has said he won’t implement the voter-approved expansion until it’s fully funded by the state Legislature. His office said on Wednesday it expects to see more critical reviews of the move from credit agencies. LePage called expansion “fiscally irresponsible” and “ruinous to Maine’s budget” on Wednesday.
About 268,000 people currently receive Medicaid in the state. Medicaid expansion supporters in at least two other states, Idaho and Utah, are also looking to get the question on public ballots.
A spokesman for Mainers For Health Care, which campaigned for the Medicaid question to pass, said LePage is touting the Moody’s report to drum up unfounded fears about the cost of expanding health coverage.
“National, multi-state, and single-state studies show that states expanding Medicaid under the ACA have realized budget savings, revenue gains, and overall economic growth,” said the spokesman, David Farmer.