June 28, 2012, the Supreme Court voted the U.S. government could not require states to expand Medicaid under the Patient Protection and Affordable Care Act. Today, 26 states and the District of Columbia have chosen to expand Medicaid, and the other 24 have yet to do so.
At the University’s School of Public Health Monday night, Benjamin Sommers, assistant professor of Health Policy & Economics at Harvard School of Public Health, discussed the implications of the Supreme Court’s decision regarding Medicaid expansion.
Sommers said a Medicaid expansion is overdue because, contrary to popular perceptions, Medicaid does not cover most underprivileged individuals. Medicaid has traditionally covered low-income people who have a disability, are pregnant, are under 18 or are parents of children who live at home. But these categories fail to capture the majority of the low-income uninsured.
“What’s conspicuously absent from those categories are the bulk of uninsured — adults between the ages of 19 and 64,” Sommers said. “Because they don’t have a child who live in the home and they don’t have a disability, they’re not eligible.”
The ACA proposed that Medicaid be expanded to every person whose income is lower than 138 percent of the federal poverty line. Sommers said such an expansion would help the bulk of low-income individuals, who many assumed it was helping already.
“The ACA essentially said forget about these categories — if you are low-income and you meet legal residence qualifications, you can get Medicaid,” Sommers said. “It essentially gives the country the Medicaid program many people think we already have.”
Sommers said the expanded Medicaid program looks great on paper. If a state chooses to expand Medicaid, the federal government promises to cover costs of the newly eligible for the first three years and at least 90 percent until 2020. For citizens formerly eligible for Medicaid, government contribution will remain the same — 60 percent or less, on average.
Although this seems large, Sommers said states that have not expanded harbor important concerns, such as the affect of expansion on state budgets. Due to the immense outreach surrounding the ACA, many people who were previously eligible for Medicaid but had not signed up would enroll after expansion. The federal government will not increase coverage for previously eligible enrollees, and the states could face high costs.
“There are actually about 10 million people in the U.S. who were already eligible for Medicaid but just hadn’t signed up,” Sommers said. “It could drive up costs for the states. They have to pay 25-50 percent of the costs for those people.”
Sommers said a majority of states also believe the federal government will not follow through on covering costs.
“Two-thirds of these states that are expanding Medicaid predict that the federal government is not going to hold up its end of the bargain,” he said. “These officials have no more insight into that issue than I do or than you do — they’re guessing.”
Sommers spent a large part of the lecture discussing what states can expect when they expand Medicaid. He cited states that expanded Medicaid relatively early, meaning in 2010 or 2011, including Connecticut, New Jersey, Minnesota, Washington and California, lessons and examples for the program’s implementation.
Sommers listed a few lessons of these early expansions. He said states gained many more enrollees than expected and the states that were not politically divided encountered fewer problems when implementing the Medicaid expansion.
Some states are choosing to expand Medicaid using alternatives to the federal system. Arkansas was the first state to implement the ‘private option,’ which takes the federal Medicaid funding and puts all would-be enrollees into private insurance plans.
In an article published Monday in the Journal of the American Medical Association, Public Policy Prof. John Ayanian, who co-authored the JAMA viewpoint with two graduate students, wrote that the level of state autonomy with regards to ACA implementation has led to uncertainty over the law’s effectiveness.
“State flexibility is a double-edged sword,” the authors wrote. “By shifting some difficult decisions from the federal government, states can tailor health reform to the needs of their stakeholders. But implementing reform through the states increases the number of elected officials able to influence implementation.”
The article notes that, across the nation, Michigan is one of only five states to accept a federal Medicaid waiver, which provides federal funding for expansion while allowing states to maintain a larger degree of self-governance. Arkansas, Iowa, Indiana and Pennsylvania are the others that have either implemented or are in the process of implementing similar programs.
While this option uses private health insurance companies, it appears to experience less resistance from conservative lawmakers, who want to avoid increasing Medicaid enrollment, the authors noted that the state-run plans could become “vulnerable to shifts in the political climate at the state and federal levels,” especially after the 2016 presidential election.
Public Health student Lauren Kuenstner said she finds it regrettable that some states have not expanded Medicaid.
“It’s unfortunate that so many uninsured people are essentially political pawns.” Kuenstner said. “A lot of governors don’t want to expand Medicaid purely for ideological reasons, and the people who are uninsured are the ones suffering the consequences.”