Report: Medicaid will expand, with or without GOP support

Kaiser study shows increased advocacy for Medicaid will expand enrollment in all states

Department of Health and Human Services Secretary Kathleen Sebelius participates in a conference to discuss the Affordable Care Act at Miami Dade College on Sept. 17, 2013.
Joe Raedle/Getty Images

One of the most contentious aspects of the Affordable Care Act — aside from its existence — is Medicaid expansion. That is, whether or not states choose to accept federal funding to expand Medicaid coverage in 2014 to include more low-income people who previously earned too much to qualify for Medicaid yet still couldn't afford to pay for health insurance.

However, a new report released Monday says that Medicaid enrollment and spending are going to rise in the next fiscal year whether the ACA’s detractors like it or not.

That’s partially due to the 24 states, and the District of Columbia, that have opted to expand Medicaid coverage to include people with incomes up to 138 percent of the federal poverty line, or around $15,856 a year for an individual.

But Medicaid enrollment will expand by an average of 8.8 percent across all states in fiscal year 2014 — 11.8 percent in the states that do expand Medicaid and 5.3 percent in the states that don't, according to the report, in which the Kaiser Commission on Medicaid and the Uninsured and consulting firm Health Management Associates surveyed Medicaid providers in all 50 states and the District of Columbia.

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That’s because the ACA calls for greater outreach efforts and a more efficient application process through the statewide insurance marketplaces — once they’re fully functioning, that is — which will affect even the states that did not want to expand Medicaid, the report said.

By contrast, Medicaid enrollment grew by just 2.5 percent across all states in fiscal year 2013, according to the report, its lowest rate in six years.

Spending on Medicaid will go up in fiscal year 2014, too — by 13 percent in the states that have expanded Medicaid eligibility and by 7 percent in those states that do not. In the previous fiscal year, total Medicaid spending increased by an average of 3.8 percent across all states, which the study calls “relatively modest compared to historical growth rates.”

Medicaid, a so-called safety-net program that was launched by the government in 1965 to provide health care to low-income adults and children and the disabled, will see a vast expansion and restructuring through implementation of the ACA.

But the states’ decisions about whether to expand Medicaid eligibility as legislated by the 2012 Supreme Court decision falls largely along political lines.

Among the 26 states that have declined the federal funding to expand Medicaid (PDF), most have Republican-controlled legislature or are helmed by Republican governors. Those states also contain a disproportionate amount of the uninsured population that could most benefit from Medicaid expansion, including 60 percent of the uninsured working poor and 68 percent of uninsured African-Americans and single mothers, according to a recent New York Times analysis of Census data.

Those states that have declined Medicaid expansion commonly cite the worry that state budgets will end up strapped with the extra cost, an expense that already accounts for some 17 percent of state funding, according to the Centers for Medicare and Medicaid Services. The federal government, though, has pledged to cover 100 percent of expansion costs from 2014 to 2016 and 90 percent of those costs by 2020.

Those who oppose Medicaid expansion also cite a system that doesn’t reimburse doctors or hospitals enough for the services they provide. In a 2012 study published in the journal Health Affairs, for example, nearly one-third of the doctors polled said they would not accept new Medicaid patients because of low reimbursement rates.

Monday’s Medicaid report showed that the ACA will have varying effects on reimbursement rates across states — in fiscal year 2013, 39 states reported that they cut rates paid to some health care providers, and 40 states reported that they increased rates paid to some health care providers, though the report did not specify by how much.

For fiscal year 2014, 34 states have planned cuts to rates paid to health care providers, according to the report, while 44 states plan at least one rate increase to a health care provider.

Al Jazeera

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