Question

As a health policy analyst for the governor of one of the states that did not expand Medicaid under the Affordable Care Act (ACA), you have been tasked with exploring whether now is a good time for your state to make a policy change. The governor has heard about the impact the Medicaid expansion has had in other states. Many of the uninsured in those states have been brought into coverage. Since the federal government is bearing the majority of the cost of the expansion, this change seems like a no-brainer. In fact, your boss read an article about a candidate for governor in Georgia who asked an audience on the campaign trail “Raise your hand if you would say no to someone who said, ‘Give me a dollar and I’ll give you $9 back’” (Goodnough, 2018, para. 3). Further, this is estimated to be costing states between $6 and $8 million per year. Your boss finds these arguments compelling, needs you to investigate the expansion option further, and has requested input before she makes her decision and a possible recommendation to the legislature. Do some research on the states that have not expanded Medicaid. Pick one to focus on and prepare a proposal for the governor that addresses the following questions:

1. What does the ACA say about the Medicaid expansion in states and how it needs to work? Who and what will the expansion cover?
2. From the experience of states that have expanded, what are the pros and cons of expansion? What are the relevant political, social, and economic concerns?
3. What’s the situation in the state you picked? Why has it not already expanded?
4. What are the political, social, and economic issues for your state that the governor needs to consider? Who will be covered? How much will it cost? Is the legislature likely to go along?
5. What is your recommendation to the governor? Is expansion in your selected state feasible or not?

Answer 1

Answers :

1. What does the ACA say about the Medicaid expansion in states and how it needs to work? Who and what will the expansion cover?

• Coverage under the Medicaid expansion became effective January 1, 2014 in all states that have adopted the Medicaid expansion except for the following: Michigan (4/1/2014), New Hampshire (8/15/2014), Pennsylvania (1/1/2015), Indiana (2/1/2015), Alaska (9/1/2015), Montana (1/1/2016), Louisiana (7/1/2016), Virginia (1/1/2019), Maine (1/10/2019 with coverage retroactive to 7/2/2018), Idaho (1/1/2020), Utah (1/1/2020), Nebraska (10/1/2020), Oklahoma (planned for 7/1/2021), and Missouri (planned for 7/1/2021).
• Arizona, Arkansas, Indiana, Iowa, Michigan, Montana, New Hampshire, New Mexico, Ohio, and Utah have approved Section 1115 waivers to operate their Medicaid expansion programs in ways not otherwise allowed under federal law. Arkansas continues to operate its expansion program through a waiver, however, the waiver provisions related to the work requirement and reduction of retroactive eligibility were set aside by court on March 27, 2019.
• Medicaid reaches many low-income children, adults, seniors, and people with disabilities.

2. From the experience of states that have expanded, what are the pros and cons of expansion? What are the relevant political, social, and economic concerns?

Prons of Medicaid expansion:

• · Increased health coverage.
• · Better access to health care.
• · Better health outcomes, including fewer premature deaths.
• · More financial security and opportunities for economic mobility.
• · Lower uncompensated care costs.

Cons of Medicaid Expansion :

• · Lower reimbursements and reduced revenue. Every medical practice needs to make a profit to stay in business, but medical practices that have a large Medicaid patient base tend to be less profitable.
• · Administrative overhead. ...
• · Extensive patient base. ...
• · Medicaid can help get new practices established

Political, social, and economic concerns ?

• Expansion may increase state revenues due to taxes related to Medicaid expansion or taxes on the increased economic activity it triggers. ... In many cases, researchers have found that Medicaid expansion generates enough savings and/or new revenue to more than offset a state's share of the cost.
• Medicaid expansion would provide more low-income adults with access to health care services, resulting in improved health outcomes. ... Medicaid expansion would reduce the health coverage gap for many individuals below the poverty level.
• However , doctors treating Medicaid patients were paid at just 72 percent of the rate they received for giving care to Medicare patients, and Medicare is itself well below private insurance payers in reimbursement levels.
• It is not surprising that the individual insurance markets are affected by the states' decisions on whether to expand Medicaid, given that Medicaid expansion removes more risky low-income individuals from the private risk pools. As a result, individual market premiums are expected to be lower, on average, in states that expanded Medicaid.
• A recent Medicaid expansion ballot initiative effort was delayed by its organizing committee to the 2022 ballot. On January 14, 2020, Democratic legislators introduced bills in both the state House and Senate to put a constitutional amendment expanding Medicaid to a statewide vote, but these are likely to fail in the Republican-controlled legislature.

3. What’s the situation in the state you picked? Why has it not already expanded?

It’s increasingly clear that  North Carolinians want to enjoy the benefits of Medicaid expansion like their fellow Americans in 36 other states, plus the District of Columbia.

North Carolina Budget & Tax Center reported last month, a new study conducted by the National Bureau of Economic Research finds a 9.3 percent decline in annual mortality for near-elderly residents in states with Medicaid expansion. The primary reason for the improvement in life expectancy is disease management while under the care of Medicaid.

The researchers also estimate that 350 people in North Carolina die annually because of the lack of affordable health care coverage. This represents the third highest number of excessive deaths, after only Texas and Florida, among states that haven’t expanded Medicaid.

In 2013, the state's General Assembly passed a bill banning Medicaid expansion, but then-Gov. Pat McCrory (R) in October 2014 said that he would consider expanding Medicaid to an estimated 500,000 state residents. The state ultimately did not expand the program under McCrory. However, Gov. Roy Cooper (D) took office in Jan. 2017 and shortly thereafter announced plans to expand Medicaid through executive action. However, a federal judge has put a temporary stay on Cooper's Medicaid expansion request. North Carolina's Legislative leaders in July dropped their case because Cooper never filed a plan to expand Medicaid. They said they would refile their legal challenge if Cooper tries to advance an expansion plan.

4. What are the political, social, and economic issues for your state that the governor needs to consider? Who will be covered? How much will it cost? Is the legislature likely to go along?

Covering 1 in 5 Americans, Medicaid reaches many low-income children, adults, seniors, and people with disabilities.

The American Health Care Act (AHCA) would end the guarantee of federal financing to states and dramatically reduce federal Medicaid financing

• The Medicaid expansion debate captures this phenomenon: uninformed or disengaged voters, profit-maximizing special interests, and self-interested politicians.
• Legislators in the General Assembly are considering spending taxpayer dollars to expand a public insurance program that would benefit a small, targeted population. This policy proposal would very likely raise health care prices in the state. But those costs increases may not be enough for people to notice because they have become accustomed to sizable increases and diminished benefits due to decisions made by previous officeholders. If North Carolinians expect higher prices, then they will be less likely to question why the prices a

  Medicaid is personally important to millions of Americans.

• Recommendation provide more low-income adults with access to health care services, resulting in improved health outcomes.
• Medicaid expansion would reduce the health coverage gap for many individuals below the poverty level.

• · Expanding Medicaid would create 40,000 jobs in North Carolina, and would help keep rural hospitals open.

  The impact of refusing Medicaid expansion

  The ACA called for Medicaid expansion in every state, covering all legally-present residents with incomes up to 133 percent of poverty (138 percent with the built-in five percent income disregard). But in 2012, the Supreme Court ruled that states could not be penalized if they didn’t expand Medicaid, and North Carolina has so far chosen that path.

  Because Medicaid was expected to be available for all low-income residents nationwide, the subsidies to purchase private plans in the exchange were not designed to apply to people living below the poverty level, which is why hundreds of thousands of North Carolina residents who live in poverty are in the coverage gap — unable to afford private health insurance, and ineligible for Medicaid because it hasn’t been expanded.

  The federal government paid the full cost of expansion through 2016. Starting in 2017, states began to pay 5 percent of the cost, and that will increase to 10 percent by 2020. The states’ portion will never exceed 10 percent, though. In North Carolina, the state’s cost to expand Medicaid is estimated at between $210 million and $600 million per year.

  Medicaid expansion advocates have long noted that the state is missing out on billions of federal dollars by rejecting Medicaid expansion. Tax dollars from North Carolina are being used to pay for Medicaid expansion in other states, while North Carolina hospitals provide about $1 billion in uncompensated care each year (a figure that would decline sharply if Medicaid were expanded and those patients had Medicaid coverage instead of being uninsured).