Part Four in Health Reform Series: Medicaid Expansion
This is the fourth and final post in a series on health care reform and its impact on our state.
Today we explore how health care reform’s expansion of the Medicaid program will help hundreds of thousands of people in Washington state gain access to health care.
Currently, more than 1 million people in Washington state – mainly children, seniors, and people with disabilities -- are able to access the health care they need thanks to Medicaid. For example, through Medicaid, low-income pregnant women get prenatal care that leads to safe births and healthy babies. Parents who don’t earn enough to afford coverage, and don’t have jobs where coverage is provided, can take their kids to a doctor when they get sick. And, people with disabilities get the care and support they need to live independently.
Federal health care reform will strengthen and expand this already vital foundation of our health care system. At least 330,000 additional people will be eligible for Medicaid beginning in 2014.(1)
Medicaid will reduce the number of uninsured people by:
- Allowing low-income adults without dependent children to enroll.
- Raising the income level for eligibility, so that people with incomes up to 138 percent of the federal poverty level, or $26,300 for a family of three, qualify.(2)
Washington state has gotten an early start and is already working to implement the Medicaid expansion. In January 2011, the federal government approved Washington state’s plan for early implementation, allowing the state to receive federal funds to provide health care to approximately 55,000 low-income or disabled people who will qualify under the expansion. Starting in 2014, Washington will benefit from the federal government paying 100 percent of the cost for this population, and all newly eligible Medicaid recipients, during the first three years of implementation.(3) The contribution declines to 90 percent by 2020 and thereafter.
By dramatically cutting the number of uninsured, the Medicaid expansion will shrink the amount of money that Washington state spends on health care for uninsured residents, known as “uncompensated care.” After all, hospitals and clinics still treat uninsured people who can’t afford to pay and someone has to foot the bill – typically it is other consumers who end up paying more for their health coverage. The Urban Institute estimates that Washington state will save between $477 to $608 million per year in such costs under health reform.(4)
If federal health care reform is struck down by the Supreme Court, the cost of uncompensated care will continue and health care will continue to be out of reach for over 330,000 Washingtonians. Those are two outcomes we just can’t afford.
1. Mike Kreidler, What’s at stake: The Affordable Care Act in Washington state: A county‐by‐county analysis (Office of the Insurance Commissioner, May 2012). http://www.insurance.wa.gov/legislative/reports/Whats-at-stake.pdf
2. Based on 2012 federal poverty guidelines; the Affordable Care Act expands Medicaid eligibility to 133 percent FPL. In addition, there is a five percentage point income disregard, effectively raising the eligibility to 138 percent FPL. Eligibility for pregnant women remains at 185 percent FPL, and eligibility for children remains at 300 percent FPL.
3. For all other Medicaid enrollees, such as those currently enrolled, the federal government will continue to pay the current 50 percent match.
4. Matthew Buettgens, et al., The ACA Medicaid Expansion in Washington (The Urban Institute, May 2012). http://www.hca.wa.gov/hcr/documents/ACA_Medicaid_Expansion_WA_State.pdf;
Declines in uncompensated care are sensitive to take-up rates and health of enrollees.