Expansion of Medicaid offers benefits far beyond improving access to care
Fifty years ago this week, President Lyndon B. Johnson signed into law the Social Security Act of 1965 establishing the Medicare and Medicaid programs.
Much has been written about the future of Medicare; but Medicaid, now our nation’s largest public insurance program, has recently become a lightning rod for debate.
Originally designed as a voluntary social insurance program for lowincome families with dependent children and disabled Americans, Medicaid now covers over 70 million people and is the critical component of our national healthcare and long-term-care safety net. Along the way it has also become a laboratory for innovation; its flexible federal-state partnership has allowed states to tailor the program to their residents, using emerging models of care delivery to improve quality of care and manage costs.
History shows that the voluntary nature of the program resulted in a 17year wait for full national implementation. Even then it was done in a very uneven manner. For some, access to benefits from the program was at best illusionary because of the extremely low eligibility levels and the degree of bureaucracy required by some states for both entry into the program and maintenance of eligibility.
The Affordable Care Act altered the paradigm and fundamentally changed the program’s potential. Under the law, Medicaid has become much more robust and brought us closer to the goal of providing nationwide coverage to all low-income people up to 138% of the federal poverty level. This is true despite a 2012 U.S. Supreme Court ruling that allowed for states to opt out of expanding their Medicaid programs.
Medicaid expansion under the ACA has unquestionably worked in improving access to care and improving quality. Nearly 14 million more people have gained access to Medicaid or the Children’s Health Insurance Program since the reform law took effect. Medicaid now serves onefifth of the entire U.S. population, which now also includes seniors, pregnant women and a significantly greater percentage of disabled and previously excluded low-income people. Despite this success, many Americans still lack health coverage and too many states aren’t accepting the law’s Medicaid expansion. As a result, more than 7 million people remain uncovered.
The 21 states that still have chosen not to expand the Medicaid program are, however, facing several realities that should result in the program’s eventual expansion: the health needs of their citizens, the changing economics of the health system and the evolving political environment.
First, the states that have not expanded the Medicaid program are already facing extraordinary health challenges. Thirteen rank in the bottom half of states as measured by America’s Health Rankings. A recent research letter published in JAMA Internal Medicine documented that eligible individuals in these nonexpansion states had poorer states of health in the five leading causes of death (heart disease, stroke, cancer, diabetes and emphysema), and had both the increased likelihood of receiving care in an emergency department or had their care delayed or avoided because of costs. All are access issues the ACA provisions are designed to address.
Second, costs for Medicaid expansion are mostly borne by the federal government. With rising costs for the uninsured in these states and the law’s reduction of disproportionate-share dollars paid to healthcare providers, states will eventually favor program expansion.
Expanding Medicaid has other economic benefits despite the false arguments posed by program critics. One such analysis by Fitch Ratings shows 30% faster job growth in healthcare jobs in expansion states.
Finally, like all things political, public sentiment changes over time and can drive the political process. Gallup polling shows that Medicaid has become increasingly popular among beneficiaries, a factor that will probably grow as more people become covered. In addition, a new waiver authority from Section 1332 of the ACA will become available in 2017, right after the next election. This little-known option will give states great flexibility to develop mechanisms that further expand coverage and craft population health models to address complex social needs. Opponents of the current Medicaid program may find that Section 1332 affords them the flexibility and political cover to design and implement Medicaid expansions.
As we honor Medicaid’s past we look forward to its future—one of continued innovation and success in improving the nation’s health.