AUSTIN, Texas (AP) -- Fully implementing the federal health care law and adding 2 million people to Medicaid would cost Texas $11 billion less than previously estimated, the state's health and human services commissioner said Thursday.
Tom Suehs said it would cost $15 billion to $16 billion over 10 years if Texas fully implemented the law. That's 42 percent less than his initial estimate of $26 billion to $27 billion to expand Medicaid to include poor single adults and more children.
A study by the federal, nonpartisan Congressional Budget Office has estimated that the additional cost for Medicaid expansion is 2.8 percent more than what an individual state would normally spend on the program.
Suehs provided the updated estimate to the state Legislature after Republican Gov. Rick Perry on Monday told federal officials he will reject any attempt to expand Medicaid in Texas. The governor has the power to veto bills and the GOP-controlled Legislature is unlikely to challenge his decision.
"Medicaid spending already consumes more than 20 percent of our budget. It is an unsustainable, budget-busting program," Perry spokeswoman Catherine Frazier said Thursday.
Suehs cautioned that a recent U.S. Supreme Court ruling on the Affordable Care Act is complex with differing interpretations that could lead to more cost-estimate revisions.
"This will get refined as we see the complexities of what we need to do," the soon-to-retire health commissioner told legislators.
The Supreme Court upheld most of the federal health care law, but ruled that the federal government cannot coerce states into expanding Medicaid, which is a joint federal-state health insurance program for the poor and disabled. Under the new law, the federal government would pay for most of the additional costs of expanding the number of people with health insurance, with the state share capped at 10 percent.
About 24 percent of Texans lack health insurance, Suehs said, the largest percentage of any state. A recent Gallup poll placed the number at 27 percent.
Suehs said expanding Medicaid would reduce the number of uninsured from nearly 5.9 million to 2.9 million. "Without Medicaid expansion, the uninsured would be back to 3.9 (million)," he said.
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