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Small Business Employee Benefits and HR Blog

Medicaid Expansion Update - The Impact of States Not Expanding Coverage

Medicaid expansion is one of the core components of the Affordable Care Act (ACA), designed to fill longstanding gaps in health coverage for low-income adults. However, the 2012 Supreme Court ruling on the ACA made Medicaid expansion optional for states. As of April 2014, 24 states are not moving forward with Medicaid expansion at this time. What is the impact to coverage and cost in those states not expanding Medicaid eligibility?

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Source: KFF

A recent analysis by Kaiser Family Foundation (KFF) looked at the impact of coverage in states who are not expanding Medicaid eligibility. 

According to KFF, among those left out of Medicaid due to their state’s decision not to expand:

  • 4.8 million uninsured poor adults, or 57% of the population that could have been eligible, fall into a coverage gap. These individuals have incomes above Medicaid eligibility thresholds but below poverty (the lower cutoff for Marketplace tax credits). Without the Medicaid expansion, these poor adults are ineligible for financial assistance to obtain health coverage under the ACA and are likely to remain uninsured.

  • 2.8 million adults, about a third of the population that could have been reached, have income between 100% and 138% FPL and may be eligible for tax credits to purchase coverage through the Marketplace.

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Source: KFF

An unintended consequence of not expanding Medicaid eligibility? Some industry experts are saying this will lead to higher health insurance premiums as hospitals continue to shift the costs of uncompensated care to private insurers. What do you think?

Read the full analysis at KFF.org.

Read an overview of Medicaid Expansion here.