Policy Playbook: Medicaid Expansion

Author: Nicholas Rizer, MD (Emergency Medicine PGY3, Johns Hopkins University) // Reviewed by: Phillip Groden, MD; Alex Koyfman, MD (@EMHighAK); Brit Long, MD (@long_brit)

What’s the issue?

The Mississippi House recently passed a bill expanding Medicaid coverage for its residents. It currently awaits a vote in the state Senate and, if successful, would result in Mississippi being the 42nd state (including the District of Columbia) to adopt ‘Medicaid expansion.’¹

Medicaid expansion seeks to increase insurance coverage by closing the ‘coverage gap’ for individuals who are unable to afford health insurance but are otherwise ineligible to qualify for traditional Medicaid. However, not all states have adopted expanded eligibility criteria.

The Origins of Medicaid Expansion

Medicaid is the insurance program for low-income Americans and operates as a federal-state partnership.² States and the federal government share the cost of health care for individuals covered by Medicaid within each state, while state governments determine the eligibility criteria for their own Medicaid program. However, to receive federal funding states must provide coverage for individuals belonging to mandatory eligibility groups; low-income parents, children, pregnant women, disabled individuals, and low-income Americans over the age of 65.³ Of note, low-income adults without children were not a core population that required coverage to receive funding under traditional Medicaid.

One of the most substantive provisions of the Affordable Care Act (ACA) was ‘Medicaid expansion.’ The federal government would subsidize states to expand eligibility for Medicaid for all residents earning up to 138% of the federal poverty limit, covering 90% of the costs of these individuals.⁴ The intent was to prevent low-income working adults from being stuck in an insurance affordability gap— earning too much to be eligible for Medicaid but earning too little to individually purchase health insurance. Of note, these individuals generally would  not be afforded subsidies to purchase private marketplace plans on the ACA exchanges. While initially written as a mandatory condition to maintain all federal Medicaid funding, the Supreme Court in National Federation of Independent Business v. Sebelius ruled that only funding for expanded eligibility could be withheld from states.⁵

Adoption, Opposition, and the Fight for Expansion

While no longer mandatory, many states rapidly adopted expanded Medicaid eligibility. Medicaid expansions began on January 1, 2014, and by the end of the year 27 states (including the District of Columbia) had expanded Medicaid eligibility.⁶ By the end the of 2016, 32 states had adopted expansion. Adoption rapidly slowed after 2016 as political opposition to the policy, as well as the ACA in general, remained strong in states with Republican-controlled state houses and governors’ mansions. Despite being very popular with voters across party lines, Medicaid expansion in Republican-led states was stalled.

In recent years, political developments have led to Medicaid expansion in numerous traditionally conservative states.  While opposition in state legislatures remained strong, several states expanded Medicaid eligibility via voter-driven ballot initiatives (e.g. Idaho, Oklahoma, Nebraska).⁷  During the Trump administration, the Centers for Medicare and Medicaid Services (CMS) approved several Medicaid plan waivers that would allow states (e.g. Kentucky, Utah) to expand Medicaid for low-income adults but also mandate work-requirements for these beneficiaries.⁸ Under the Biden administration, CMS is not renewing or approving new work-requirement waivers, yet for now such states continue to have expanded Medicaid eligibility.  After many years of sustained advocacy and political negotiations, in April 2023 the North Carolina legislature became the 41st and latest state to adopt Medicaid expansion.⁹ If Mississippi adopts Medicaid expansion, it may be the last state to adopt Medicaid expansion for the foreseeable future, given entrenched political opposition in the remaining non-expansion states.

Why does it matter?

Medicaid expansion has improved health insurance coverage rates in states that have successfully adopted the program. Studies have shown that insured adults have better health outcomes and service utilization patterns compared to uninsured controls— including improved chronic disease (e.g hypertension, diabetes, HIV, ESRD) outcomes, rates of preventative screening exams and mental health treatment, and mortality rates associated with emergency care and hospitalizations.¹⁰  Furthermore, there is increasing evidence that low-income individuals in states that have expanded Medicaid eligibility specifically have better access to care and improved health outcomes.¹¹

While the campaign for expanded coverage in Mississippi is actively in progress, it is unlikely a substantial number of the 9 remaining “hold-out” states will expand Medicaid eligibility in the near future due to strong political opposition. This will certainly contribute to disparities in health outcomes that will persist for low-income Americans depending on the state they live in.

What can I do about it?

• Become informed on the status of Medicaid expansion in your state. The Kaiser Family Foundation offers an interactive map that is a good place to start.
• If you live in a state that has not expanded Medicaid become informed on the arguments opposing Medicaid expansion in your state and engage in advocacy. Whether writing an Op-Ed or speaking with a state legislature, your voice as a physician or medical student is very important and carries a lot of weight.

This post was a collaboration between emDocs and the EMRA Health Policy Committee.

References/Further Reading:

1. Paffenroth S, Harrison B. “Moral imperative”: House overwhelmingly passes Mississippi Medicaid expansion. Mississippi Today. Published February 29, 2024. Accessed March 5, 2024. https://mississippitoday.org/2024/02/28/mississippi-medicaid-expansion-house-legislature-passes-work-requirement/
2. Williams E, Rudowitz R, Burns A. Medicaid Financing: The Basics. KFF. Published April 13, 2023. https://www.kff.org/medicaid/issue-brief/medicaid-financing-the-basics/
3. Centers for Medicare and Medicaid Services. List of Medicaid Eligibility Groups.; 2019. https://www.medicaid.gov/sites/default/files/2019-12/list-of-eligibility-groups.pdf
4. Congressional Research Service. Overview of the ACA Medicaid Expansion.; 2021. https://crsreports.congress.gov/product/pdf/IF/IF10399
5. National Federation of Independent Business v. Sebelius. Oyez. Published 2019. https://www.oyez.org/cases/2011/11-393
6. Allen K. Medicaid Expansion Considerations For Non-Expansion States. Health Management Associates. Published December 20, 2018. https://www.healthmanagement.com/blog/medicaid-expansion-considerations-non-expansion-states/
7. Status of State Medicaid Expansion Decisions: Interactive Map. KFF. Published December 1, 2023. https://www.kff.org/medicaid/issue-brief/status-of-state-medicaid-expansion-decisions-interactive-map/
8. Guth M, Musumeci M. An Overview of Medicaid Work Requirements: What Happened Under the Trump and Biden Administrations? KFF. Published May 3, 2022. https://www.kff.org/medicaid/issue-brief/an-overview-of-medicaid-work-requirements-what-happened-under-the-trump-and-biden-administrations/
9. Stolberg SG. Will North Carolina Be the “Beginning of the End” of the Medicaid Expansion Fight?. The New York Times. https://www.nytimes.com/2023/04/09/us/politics/medicaid-expansion-north-carolina.html. Published April 9, 2023.
10. Institute of Medicine (US) Committee on the Consequences of Uninsurance. Effects of Health Insurance on Health. In: Care without Coverage: Too Little, Too Late. National Academies Press (US); 2002. https://www.ncbi.nlm.nih.gov/books/NBK220636/
11. Guth M, Garfield R, Rudowitz R. The Effects of Medicaid Expansion under the ACA: Updated Findings from a Literature Review. The Henry J. Kaiser Family Foundation. Published March 17, 2020. https://www.kff.org/medicaid/report/the-effects-of-medicaid-expansion-under-the-aca-updated-findings-from-a-literature-review/