This is expected to generate more than $34 billion in state savings. Because these adults are now newly eligible under the ACA, the federal government will pay an increased share of their costs, rising to 90 percent by 2020.Seven “prior expansion” states already offer Medicaid to childless adults up to at least 100 percent of the federal poverty level (FPL).Similarly, expansion states will see large savings on mental health and substance abuse services currently provided to uninsured adults, which could amount to $22 billion nationally.Įxpansion states will also see major savings from the reclassification of “existing eligible” clients to “newly eligible.”.Medicaid expansion provides the uninsured with a regular source of coverage, saving states as much as $52 billion in uncompensated care.doctors and hospitals provided upwards of $57 billion annually in uncompensated care. When the uninsured seek medical care but do not pay for it, the bill falls to someone else-and that someone else is usually the government. In other words, the feds are paying for 93 cents of every new Medicaid dollar.Īs if this wasn’t already a good deal for states, it gets even sweeter-because states will save billions on lots of things they currently pay for. If all states expand Medicaid, the feds will inject $952 billion into state budgets between 20.The federal government will bear the lion’s share of new Medicaid costs through 2016, declining to 90 percent by 2020.The major argument expansion opponents make is that it will be too expensive for cash-strapped states. What may change their minds, though, are costs. Persuading the CynicsĪll this is well and good, but it is unlikely to make converts of Obamacare’s critics. Fast-tracking, or facilitated enrollment, allows states to offer an express lane to residents already known in their welfare systems, such as food stamp recipients.īecause eligibility standards for food stamps are generally more stringent than those for Medicaid, states can effectively presume such individuals are eligible for the Medicaid expansion and enroll them with minimal hassle, conserving valuable administrative resources and bypassing bureaucratic delays. Second, a handful of states have taken advantage of a “fast-tracking” option permitted by the federal Department of Health and Human Services.
First, states operate their own Medicaid programs, which means they are largely insulated from the federal government’s IT issues. Two main factors account for Medicaid’s early success. In Kentucky, four out of every five of the state’s 26,000 newly insured can thank Medicaid for their benefits. In Washington, the Medicaid expansion accounts for half of its 35,000 new enrollees. Of the 37,000 people who have thus far gained health coverage in New York, for example, two-thirds qualified through Medicaid. Thus far, 25 states (including D.C.), have opted for expansion, while 26 (mostly red) states remain on the sidelines. While the federal health exchange languishes in an unflattering public spotlight, Medicaid expansion is off to a flying start. The ACA changed this, expanding Medicaid to all adults age 19-64 who are below 138 percent of the federal poverty. Over the years, some states have opted to extend coverage to parents of poor children, particularly if they are working, but there has never been a national health insurance safety net for able-bodied childless adults. Traditionally, however, the program, which operates as a partnership between the federal government and the states, has been mostly limited to children, pregnant women, the disabled and certain elderly adults dually-eligible for Medicare. Since its creation in 1965, Medicaid has served as America’s health insurance safety net for poor families. Amid the clamor over Obamacare’s early and embarrassing IT struggles, a quieter victory for the Affordable Care Act is well underway.
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