One area of agreement in the 2013-15 budget proposals is Medicaid expansion under the federal Affordable Care Act. Both the House and Senate assume state savings of about $318 million from expansion.

Despite the promise of such savings, many states have rejected expansion or are still wrestling with the decision. According to the Kaiser Family Foundation, as of May 30, 23 states (including DC) have decided to move forward with the expansion, 20 are not moving forward at this time, and eight are still considering it. (In the Wall Street Journal last week, Stephen Moore wrote about the debate in Michigan.)

Tyler Cowen recently linked to a study in Health Affairs that found that “in terms of coverage, cost, and federal payments, states would do best to expand Medicaid.” Not so fast: Cowen writes,

I do understand that part of their argument is a normative one, given the desire to expand insurance coverage for the currently uninsured. But they and their endorsers also seem to be making a state-level financial prudence argument, as if there were no possible reason for a state not to expand participation behind sheer ideological stubbornness.  On that matter I don’t think they have pondered the problem deeply enough and they fail an intellectual Turing test.

One reason that rejection of expansion may be perfectly rational is, as Dick wrote last month when Florida decided not to expand, “The problem for many is that the feds can be an unreliable partner.”