[J]ust before Christmas, Texas Gov.-elect Greg Abbott signaled that he might be open to a compromise that finally would bring as many as 2 million low-income Texan adults and children under the coverage umbrella. At a meeting with Houston-area state legislators, the Houston Chronicle reported, Abbott asked for more information about Utah's groundbreaking compromise with the feds on Medicaid expansion.  [...]

Yet in no state is the economic logic of expanding Medicaid as self-evident as it is in Texas. The state consistently leads the nation in its ratio of uninsured residents -- 22.1% in 2013. (The national average in 2014 is 13.4%.) A 2013 report by former deputy state comptroller Billy Hamilton projected that the state would lose $7.7 billion in federal funds and incur $397 million in costs through 2015 by shunning Medicaid expansion. Acceptance would relieve Texas hospitals of a sizable share of the $17 billion in uncompensated care they provide to uninsured residents every year. 

Without expansion, nearly 900,000 Texan children lack coverage. The state has had the highest uninsured rate among residents earning less than 138% of the federal poverty line, the income ceiling for Medicaid expansion, at 55%. Under the ACA, the federal government would cover 100% of the cost of serving those residents via Medicaid through 2016, after which the match declines in stages to a permanent 90% in 2020 and beyond.

The Utah program in which Abbott expressed interest is a refinement of a deal pioneered by Arkansas, which allows federal funds to be used for the purchase of private insurance for the target population.