February 19th 2016 - Written by: Jeff Mitchell

Insurance and Employment Impacts of Medicaid Expansion in New Mexico

According to the Henry J. Kaiser Family Foundation (http://kff.org/health-reform/state-indicator/total-monthly-medicaid-and-chip-enrollment/#) Medicaid/CHIP enrollment in New Mexico increased by 274,518 persons (60%) between January 1, 2014 and November 2015. Only four states have seen larger increases by percentage (Kentucky, Nevada, Colorado and Oregon). Note that not all of the increase in enrollment are individuals enrolled in Centennial Care; many have enrolled in programs previously available to New Mexicans (e.g. CHIP).

In addition to providing health insurance to more than a quarter million New Mexicans, expanded enrollment in Medicaid has had a substantial employment impact in the state. The following is an analysis of the growth of employment in the health care and social assistance sector (NAICS 61) since January 1, 2014. The source of this data is the BLS Quarterly Census of Employment and Wages.

Employment Growth in Health Care & Social Assistance, by Owner and Subsector,   2013Q-2015Q2
employment growth in health care

Since the beginning of 2014, employment in health care and social assistance in New Mexico has increased by 4.8% (from 128,277 in 2013Q to 134,427 2015Q, the most recent quarter with census data). Employment growth has been strongest in Social Assistance subsector 11.2% vs.), accounting for 54% of the net gain in health care. At the same time, there has been huge increase in the number of social assistance establishments (from 2,495 to 4,040, a gain of 61.9%). Consequently, the average number of jobs per social assistance establishment has fallen sharply (from 11.8 to 8.1), perhaps reflecting that growth has been in lower density rural locations. Nearly 90% of social assistance jobs are in the private sector, and this is where job growth has been strongest (12.2%).

Apart from social assistance, there have also been reasonably strong gains in ambulatory care and hospitals (3.6% in each). Ambulatory care is almost entirely in the private sector (97%). Interestingly, the number of private establishments providing ambulatory health services has declined slightly; thus the average size of these establishments has increased by 13.7 to 14.3 jobs per establishment.

The public sector has a significantly stronger presence in the hospital sector than in other areas of health care. Fully 89% of Federal employment in health care is in hospitals, including those administered by the Veterans Administration and Indian Health Service (IHS). Nearly two-thirds of State health care employees work in hospitals, including University of New Mexico Hospitals. Employment growth in federal, state and private hospitals has expanded at the same rate (3.6%) since the expansion of Medicaid.

Employment in nursing homes has declined slightly (loss of 77 jobs, -0.5%). This is unsurprising, as changes in health care policy have focused on Medicaid programs; seniors, most likely to be enrolled in Medicare programs, have not seen any changes as a result of recent policy changes.

Average wages in health care in New Mexico have increased at an average annual rate of 1.3% since the expansion of the Medicaid program. Wage growth has been strongest in State and Federal-run institutions (3.2% and 2.8%, compared to 0.8% in the private sector). This reflects of the composition of new jobs. Job growth for government-run institutions has been strongest in hospitals, where average salaries are highest, while job growth in private institutions has been strongest in the low-paying social assistance subsector.

Nearly one-half (46%) of all health care and social assistance jobs are located in the Albuquerque MSA; another 19.5% are in other metro areas; and the remaining 34.5% are located in rural areas. Since the expansion of Medicaid, job expansion has favored metro New Mexico, and in particular metro areas other than Albuquerque. Employment growth in health care has increased by 6.8% per year in Las Cruces and Santa Fe; 4.8% in Albuquerque; and 3.4% in non-metropolitan areas of the state. Detail is not available to allow for a comparison of the state’s regions by health care subsector.

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