Medicaid expansion

What is Medicaid expansion?

A provision in the Affordable Care Act (ACA) called for expansion of Medicaid eligibility in order to cover more low-income Americans. Under the expansion, Medicaid eligibility would be extended to adults up to age 64 with incomes up to 138 percent of the federal poverty level (133 percent plus a 5 percent income disregard).

But in June 2012, the Supreme Court ruled that states could not be forced to expand their Medicaid programs, so it was left to each state to determine whether to participate or not.

As of 2019, Medicaid had been fully expanded in 33 states and the District of Columbia. In addition, Utah has partially expanded Medicaid; Idaho will expand coverage as of January 2020 (enrollment begins November 2019), and Nebraska will expand coverage in late 2020 (Utah’s Medicaid expansion currently only extends to those earning up to 100 percent of the poverty level, which is the same as Wisconsin although Wisconsin is considered a non-expansion state; neither state gets Medicaid expansion funding at this point),

The federal government is financing most of the cost of expanding Medicaid, and a small portion is being paid by participating states. The costs for enrollees who are newly eligible under the expanded guidelines was covered 100 percent by the federal government until 2016. That will gradually decrease to 90 percent by 2020, but will not go below that amount.

As of 2019, official Medicaid data put the total newly-eligible enrollment at about 10 million. Total enrollment in Medicaid/CHIP has increased by 26 percent since 2013, although enrollment growth is much higher than that average (34.4 percent) if we only consider states that have expanded Medicaid.

However, in the states that have not expanded Medicaid, there’s a coverage gap that leaves about 2.5 million people ineligible for any sort of affordable coverage. And according to US Census data, the percentage of people below the poverty level who are uninsured is more than twice as high in states that haven’t expanded Medicaid, compared with states that have. To be clear, this is due to the decisions that their states have made, rather than a flaw in the ACA itself. The states could opt to accept federal funding to expand Medicaid at any time, thus closing the coverage gap.

Five states — Texas, North Carolina, Florida, Georgia, and Tennessee — account for the lion’s share of the coverage gap population, and they are among the 14 states where expansion is still a contentious issue and the legislature and/or governor are still strongly opposed to accepting federal funding to expand Medicaid. North Carolina has been in the national spotlight in 2019 over Medicaid expansion discussions, but it appears unlikely that the state will pass expansion this year.

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