Nine-to-one is a pretty good bargain. After all, the feds cover only about two-thirds of Medicaid's costs today.

That said, some states clearly win bigger from the expansion than others, and they're not in the South. The top prize may go to New York. The Empire State has spent lavishly on Medicaid in the past, so it won't have to adjust its eligibility rules much at all to qualify for additional federal money. Ultimately, Kaiser predicts the law will shave $33 billion, or 7 percent, off of Albany's 10-year Medicaid obligations, as Washington will end up covering them instead (the other states set up for that sort of a windfall are shown in white on the map below). Vermont and Delaware wouldn't receive as many billions, but would similarly hand over about 11 percent of their costs to the federal government.

Texas, by contrast, would still have to boost its total spending on the program by 3.5 percent if it loosened its eligibility enough to meet Obamacare's standards. So again, for them, the expansion isn't free.

But there are still good reasons for recalcitrant GOP governors like Perry to go along with it. First and foremost, their Medicaid rolls are probably about to grow no matter what. The health reform law's various provisions, such as the individual mandate, will likely encourage some Americans who already qualify for Medicaid but haven't enrolled to finally sign up. Since these people will be eligible under the old Medicaid rules, they won't be qualify for the generous, nine-to-one federal matching funds Obamacare offers. Collectively, they'll cost state governments $68 billion. Texas alone is looking at a $3.9 billion budget increase as more than half a million enrollees join Medicaid due to the health care reform law's mere existence.





So that's a stick; here's a carrot. Thanks to their huge uninsured populations, these states already spend a boatload of money treating patients who show up in emergency rooms without the means to pay for their care. Kaiser estimates that about 30 percent of those uncompensated medical expenses end up getting paid for by state and local governments now. More people on Medicaid would mean fewer uninsured sick to budget for. As a result, even in the South, the program's expansion would raise government healthcare spending on the poor by no more than 3.1 percent, as shown on the dark blue bars below.

Let's use Texas again as an example of what that means. In the end, agreeing to the Obamacare expansion would cost the state about $3.9 billion extra over the decade and result in coverage for an additional 1.8 residents. That's about a 2.4 percent increase in what the state would otherwise spend on Medicaid and treating the uninsured once they land in hospitals. That's cheap.

But there's another way to look at it: value per Texas tax dollar. Rick Perry could say no thanks to the Obamacare expansion, in which case Texas will have to cover about 554,000 new Medicaid participants at a cost of around $7,000 per head. Or it could take more federal money, expand its eligibility rules, and cover about 2.4 million low income residents for about $3,300 a head. In short, the state can pay the retail price for its new Medicaid enrollees, or it can pay the bulk rate.