New Analysis Predicts Decreases in Uninsured, Federal Government Covering Costs

• 6/7/2010
• Author: Audrie Bretl Roelf
• Category: Benchmark Blog
• 8973 Views
• 0 Comments
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The expansion of Medicaid under the new health reform law will significantly increase the number of people covered by the program and markedly reduce the uninsured in states across the country, with the federal government picking up the majority of the cost, according to a state-by-state analysis released by the Washington, D.C.-based Kaiser Family Foundation's Commission on Medicaid and the Uninsured.

The analysis is among the first to show the distribution of new Medicaid enrollees and costs for all 50 states and the District of Columbia, as well as the impact that health reform will have on the uninsured. Health reform offers Medicaid coverage to millions of low-income adults for the first time and helps establish a national floor for Medicaid eligibility that contrasts sharply with the wide variation in eligibility across current state Medicaid programs.

States with large uninsured populations currently are expected to see the biggest increases in the numbers of people who obtain health coverage through Medicaid. California and Texas—for example, two states with considerable numbers of uninsured residents—are each projected to see 1.4 million fewer uninsured adults in 2019 due to the Medicaid expansion, with the federal government covering 95% of the cost in Texas and 94% in California.

Nationally, the analysis projects that Medicaid enrollment will climb by 15.9 million more people by 2019 than it otherwise would have, and that the number of uninsured will fall by more than 11 million persons. The cost of the Medicaid expansion between 2014 and 2019 would be jointly financed, with the federal government paying $443.5 billion (or 95.4 % of the total cost) and the states contributing $21.2 billion. 

It is difficult to predict the impact of the new Medicaid outreach and enrollment efforts under health reform, as well has how states will respond.  So the analysis contemplates two scenarios and applies a uniform rate of enrollment (participation rate) among those eligible for Medicaid. 

Both scenarios examine the coverage and cost impact of the Medicaid expansion for adults with annual incomes at or below 133% of the federal poverty level (FPL), which is $14,404 for an individual under current poverty guidelines. The scenarios do not account for the impact of reform for children or state savings related to reductions in uncompensated care costs or reductions in Medicaid coverage for adults currently covered above 133% FPL. Nor do they factor in other changes in Medicaid in health reform related to provider payment rates, changes to the drug rebates or new options related to payment reform. 

How do you see these changes effecting your organizations? Are you currently doing anything differently to prepare for the expected increase in insured patient?