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How the COVID-19 Pandemic Has Affected Medicaid Expansion vs. Non-Expansion States

How Medicaid expansion states benefited in providing access to care over non-expansion states during the COVID-19 Pandemic.

By: Juan Chico, Executive Director, Ana Lopes, Manager - Medicaid, Alisha Mendez, Manager - Medicaid, Michael Lopez, Manager- Medicaid, Francisco Francisco, Assistant Manager - Medicaid and Marian Franqui, Medicaid Eligibility Specialist

As a result of the COVID-19 pandemic, millions lost jobs, income and access to health insurance. A look at how healthcare varied across the nation shows the benefit of Medicaid expansion for states that opted to expand coverage in comparison to states that did not.

The Medicaid expansion under the Affordable Care Act (ACA) has been adopted by 38 states – which positioned these states to better respond to COVID-19 and address access to care, financial security, and health disparities issues. In expanded states there were over five million people who enrolled into Medicaid in a six-month span (February 2020 – August 2020). Many of these enrollees were not only families but single adults. The single, childless adult population is the latest category of eligible candidates for expanded coverage as a result of the ACA.

Non-expanded Medicaid states did not see as high of an enrollment increase during the pandemic, resulting in significant repercussions. Currently, there are over four million uninsured adults within the 12 non-expanded Medicaid states. This number has nearly doubled since the COVID pandemic, whereas previously there were just about two million uninsured adults, 77% consisting of adults without dependent children. This portion of the population may face additional health risks because of the lack of healthcare coverage.

Another benefit acquired by the 38 Medicaid expansion states is the cost-sharing responsibilities, wherein these states are only responsible for 10% of the cost while the federal government covers the remaining 90%. According to Mark Hall, a senior fellow at the Brookings Institute, Medicaid Expansion states have indicated that the actual cost to the state in choosing to expand Medicaid areminor and they do not regret their decision to expand nor have any of the 38 states chosen to opt out. ”Expanded states will receive $1,755 in funds per resident while non-expansion states will only receive $1,198 from the federal funding under the Corona, Aid, Relief and Economic Securities Act (CARES ACT).

Healthcare providers across the nation have been going through various obstacles trying to address challenges created by the pandemic. High-risk individuals with underlying health conditions diagnosed with COVID-19 in non-expanded states are 52% less likely to have adequate health insurance than those living in expanded states (Bachrach, SHVS).Patients from non-expanded states more often refrain from seeking medical attention, which ultimately leads to poor healthcare management, over-usage of the emergency room, and unpaid medical expenses.

On the other hand, patients from expanded states more often seek preventive care services, which improve quality of life and minimize healthcare costs.Medicaid expanded states have gained significant benefits enrolling patients through the presumptive eligibility program, which consists of providing general living arrangement details to obtain immediate coverage for urgent healthcare services. In addition, Medicaid expanded states benefit from applicants providing minimal documentation to help streamline the approval process, as well as allowing Medicaid recipients to be automatically re-enrolled by the state and local county agencies.

Non-expansion states suffer loss of revenue due to a higher number of uninsured patients and charitable write offs, resulting in lower reimbursement rates. Although HRSA funding is made available to providers nationwide by the federal government, these funds are limited to COVID-19-related services and do not adequately address other areas of need within the healthcare industry.

At this point in time there is a lot of uncertainty with how the Biden Administration will handle potential policy changes to the ACA. There is a chance that the Biden Administration may provide an opportunity for non-expansion states to expand Medicaid eligibility further to individuals who would otherwise not qualify for benefits. Throughout the ongoing pandemic it has been evident that healthcare providers are able to maintain a more consistent flow of revenue and improved healthcare in expanded states. At the same time, expanded states should be prepared to adjust for unexpected policy changes that may result in millions of people being dis-enrolled and forcing states to go back to a more traditional Medicaid eligibility approach. In that scenario, healthcare providers would have to allocate additional resources to enroll categorically eligible individuals onto more complex programs such as SSI, Emergency Medicaid for Aliens, and Long Term Care support services for the Aged, Blind, Disabled population.


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