Health and Medical News and Resources

General interest items edited by Janice Flahiff

The Math of State Medicaid Expansion

English: President Barack Obama's signature on...

English: President Barack Obama’s signature on the health insurance reform bill at the White House, March 23, 2010. The President signed the bill with 22 different pens. (Photo credit: Wikipedia)


Excerpts from the Rand Report


In June 2012, the Supreme Court ruled on the constitutionality of key components of the Affordable Care Act; and foremost among these were the individual mandate and Medicaid expansion. The Court judged the former to be constitutional but allowed states to “opt out” of the Medicaid expansion and some states have indicated that they will exercise this option. How might state choices affect health care coverage and costs?

The Patient Protection and Affordable Care Act (ACA) provides for three basic ways to increase health insurance coverage: the expansion of Medicaid to cover the poorest population; the provision of subsidies for those with low or medium incomes to purchase coverage on the new health insurance exchanges; and the institution of an individual mandate requiring everyone to have insurance. Taken as a whole, the ACA is highly controversial. However, Medicaid expansion and the individual mandate are particularly contentious issues, and the constitutionality of both was challenged, ultimately landing on the docket of the Supreme Court.

In June 2012, the Court ruled that the individual mandate was constitutional but gave states the option of not participating in the Medicaid expansion slated to begin in 2014. As of the spring of 2013, governors from 14 states had indicated publicly that they will choose to opt out.

Medicaid Expansion by StateThe state-by-state breakdown as of spring, 2013. States where governors have stated they will not expand Medicaid are indicated in white, states that are leaning toward opting out or seeking alternative options are indicated in gray, and the remainder are red.

Source: The Advisory Board Company

What does Medicaid expansion offer states?

  • More federal Medicaid funds: Under the ACA, the federal government will pay 100 percent of the coverage costs for those newly insured under Medicaid expansion. After 2016, the federal share gradually shrinks to 90 percent, substantially more than the 57 percent they currently pay on average.
  • Greater access to care for the poor: Medicaid expansion makes health care more accessible to the poorest segment of the population — those earning less than 138 percent of the federal poverty level (this amounts to an income of about $16,000 for a single person or $32,000 for a family of four in 2013).
  • Reduced outlays for uncompensated care: Providing insurance to the very poor reduces uncompensated costs of treatment for this group — an estimated $80 billion in 2016. Currently, about one-third of these expenditures come from state coffers.
  • Reduces financial risk for the lowest-income Americans: Analysis of Oregon’s Medicaid experiment found that the financial hardship associated with medical coverage was dramatically reduced.


The report goes on to explain

  • Without Medicaid expansion, the poorest population could fall through a coverage gap.
  • What could be done about the coverage gap for low-income populations?
  • The bottom line.



July 22, 2013 - Posted by | health care | , , , , , ,

1 Comment »

  1. Janice,

    Nice blog. We all need to keep digging up information on the implementation of ACA and share it widely so that communities get a chance to mobilize to articulate, work for and defend their interests.

    We at the Policy ThinkShop are delighted when we connect with other blogs like yours–giving all of us a sense that grass roots work can be elevated to the “forest canopy” reaching our national community of well wishers, do gooders and good Samaritans!

    Thanks for sharing our research …


    The Policy ThinkShop team!

    Comment by Policy ThinkShop Blogger | August 1, 2013 | Reply

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