Medicaid Expansion Will Boost Virginia’s Small Businesses, Economy

The Virginia House of Delegates extended a helping hand to small businesses when it voted today in favor of expanding the state’s Medicaid program because doing so would level the playing field for small businesses, create a healthier and more productive workforce and pump additional money into the state economy.

Medicaid expansion in Virginia is estimated to extend coverage to an additional 400,000 people, many of whom are low-wage working adults. Since so many more working adults would qualify for Medicaid, small businesses that cannot afford to offer their employees health insurance would be better able to compete for workers with big businesses that can afford to offer health insurance. It would also help more low-income entrepreneurs access health coverage as they’re getting their businesses off the ground.

What’s more, just like a new factory or federal construction project, Medicaid expansion would stimulate Virginia’s economy. Indeed, expanding Medicaid would bring an infusion of more than $2 billion per year of federal money into the state, resulting in an estimated 18,000 new jobs. If Virginia does not expand Medicaid, however, it will continue to forfeit a whopping $142 million in federal funding every month.

Additionally, by expanding Medicaid, Virginia can help rein in small business owners’ premium costs. When someone without insurance seeks medical care they can’t pay for, government or charity may pick up some of the cost but the rest remains unpaid. To cover it, insurers charge higher rates when the insured receive care, and these increases get shifted to higher premiums. Expansion means that fewer individuals receive uncompensated care, so fewer costs will be passed on.

The bottom line is that expanded Medicaid programs help lower insurance costs for small businesses and encourage a more robust workforce. With lower insurance costs and healthier workers, small employers can worry less about healthcare and concentrate on what they do best: growing their businesses and creating jobs. We urge the Virginia Senate to ensure the state moves forward with a robust Medicaid program that benefits small firms and their employees.