January 30th, 2014
The Affordable Care Act (ACA) was designed to increase access to health insurance by: 1) requiring states to expand Medicaid eligibility to people with incomes less than 138 percent of the Federal Poverty Level (FPL) ($19,530 for a family of three in 2013), with the cost of expanded eligibility mostly paid by the federal government; 2) establishing online insurance “exchanges” with regulated benefit structures where people can comparison shop for insurance plans; and 3) requiring most uninsured people with incomes above 138 percent FPL to purchase insurance or face financial penalties, while providing premium subsidies for those up to 400 percent of FPL.
Recent studies suggest that Medicaid expansion will result in health and financial gains. Older studies also found salutary health effects of expanded or improved insurance coverage, particularly for lower income adults. These studies also document an increase in utilization of most health care services. Most recently, the Oregon Health Insurance Experiment (OHIE) found a striking increase in emergency department use as well as other outpatient care.
The Supreme Court ruled in June 2012 that states may opt out of Medicaid expansion, and as of November 2013, 25 states have done so. These opt-out decisions will leave millions uninsured who would have otherwise been covered by Medicaid, but the health and financial impacts have not been quantified.
In this post, we estimate the number and demographic characteristics of people likely to remain uninsured as a result of states’ opting out of Medicaid expansion. Applying these figures to estimates of the effects of insurance expansion from prior studies, we calculate the likely health and financial impacts of states’ opt-out decisions.Read the rest of this entry »