Medicaid Expansions

One of the major vehicles in the Affordable Care Act (ACA) to increase health insurance coverage is an expansion of Medicaid to adults with incomes at or below 138% of the federal poverty level (FPL). While the expansion was intended to be implemented in all states, as a result of the Supreme Court decision on the ACA, it is now effectively a state choice. Based on an analysis of 2011 American Community Survey data, this brief examines the implications of current state Medicaid expansion decisions on coverage by race and ethnicity.

The ACA specifies a standard definition of income – Modified Adjusted Gross Income (MAGI) – that will be used to determine eligibility for both Medicaid and the Exchange-based premium tax credits and cost-sharing reductions. The adoption of MAGI creates a number of issues for states, particularly when applying MAGI to eligibility determination for Medicaid. In this brief, the author reviews the income that is included in MAGI and how income is currently counted in determining Medicaid eligibility. Issues related to measuring MAGI on a monthly basis for Medicaid eligibility determination are discussed, and the author offers some thoughts on how states might begin to address these issues in their application of MAGI to determine eligibility for Medicaid.

Since US Supreme Court’s ruling on the ACA that allowed states to opt out of the health reform law’s Medicaid expansion, fourteen governors have announced that their states will not expand their Medicaid programs. This paper’s authors used the RAND COMPARE microsimulation to analyze how opting out of Medicaid expansion would affect coverage and spending, and whether alternative policy options—such as partial expansion of Medicaid—could cover as many people at lower costs to states. They concluded that in terms of coverage, cost, and federal payments, states would do best to expand Medicaid.

An estimated 47 million Americans will transition at least once annually between Medicaid and subsidized health insurance exchanges starting next year. Only close collaboration between CMS and state exchanges will avoid interruption in insurance coverage and cost increases during these transitions. In her updated Health Reform GPS implementation brief, George Washington University's Sara Rosenbaum reviews FAQs recently issued by CMS that address issues related to Medicaid/Exchange alignment.

This chart tracks state Medicaid expansion decisions and includes additional details on key elements of Medicaid expansion bills that have been introduced in state legislatures, such as proposals to provide coverage to the expansion population through qualified health plans on the exchange, special requirements related to cost sharing or care delivery, or options allowing a state to discontinue participation in the expansion. This chart is a record of legislation introduced, but does not track the exact status of bills moving around in state legislatures.