Introduction
The expansion of Medicaid is considered a key component of Obamacare (Affordable Care Act) that focused on providing healthcare coverage to millions of uninsured Americans (Buettgens, Holahan, and Recht, 2015). Some of the low-income earners and poor people who do not have health insurance in the U.S. live in Texas. Medicaid is administered or run by individual states and the federal government. Individuals who enroll for Medicaid benefit by not paying premiums for healthcare coverage. The state hospitals are using about $5.5 billion annually for treating uninsured people. The uncompensated healthcare costs are, therefore, covered by insurance premiums and taxes paid by residents and businesses. While the Affordable Care Act calls on all states to expand their Medicaid programs, the 2012 decision by the Supreme Court implied that the states cannot be forced by federal government to expand their programs (Buettgens, Holahan, and Recht, 2015)
Implications of the Decision Not To Expand Medicaid
Texas is one of the states that chose not to expand their Medicaid program. The state is home to many uninsured Americans, and the decision has left them without viable options for affordable health insurance. Texas’s opposition to enrollment and outreach assistance has compounded the problems for the uninsured Texans who would otherwise be eligible for healthcare coverage under the ACA. Consumer groups and stakeholders in Texas continue to implore the state’s leadership to consider expanding Medicaid for the benefit of low-income Texans.
Research indicates that the expansion of Medicaid became a highly politicized issue because of what it represents politically. The Republicans used to express their disagreement with Obamacare, arguing that they are concerned with the cost implications of expanding Medicaid (Buettgens, Holahan, and Recht, 2015). The states that opted not to expand will forgo millions of federal matching funds as well as millions in hospital reimbursements. The non-expansion creates a situation where poor or low-income individuals are denied coverage while individuals with incomes above 138% FPL are receiving subsidies which they are using to purchase health insurance (Buettgens, Holahan, and Recht, 2015). Therefore, low-income Texans miss out on some of the benefits associated with Medicaid such as reduced spending on healthcare. Medicaid represents the federal government’s efforts to improve the welfare of groups that are worse off economically.
Compare The Potential Opportunities and Challenges of a State’s Decision to opt into the Medicaid Expansion
The states that chose Medicaid expansion have registered a significant decline in their rates of uninsured, as well as the costs hospitals, are incurring when providing care to individuals without insurance (Blumberg, 2012). In Texas, childless adults cannot obtain Medicaid coverage while adults with children but earn over 19% of the federal poverty level are also not covered. Obamacare called on all states to expand the Medicaid eligibility criteria to include all adults, whether childless or not, who are earning below $16,105 per individual. For the states that choose to participate in the expansion of Medicaid, the federal government will meet all the costs for the first three years then phase down to 90% federal and 10% state funding (Blumberg, 2012). The Medicaid expansion under ACA would cover millions of low-income uninsured Americans (Blumberg, 2012). In states like Texas that chose not to expand their Medicaid, the rates of the uninsured have been dropping at a slow pace. The small coverage gains in Texas are attributable to the ability of some of low income Texan adults to purchase health coverage available on the federal marketplace for health insurance.
A comparison between the states that opted not to expand their Medicaid and their counterparts that opted for Medicaid expansion depicts the way the decision not to expand has left many Texans, with relatively low-incomes, less capable of affording their medical bills, care for chronic conditions, and pay for essential prescription drugs. Ideally, states that chose not to expand their Medicaid programs will continue to experience slow rates of coverage.
Alternate Models
States that are planning on using Medicaid funds for purchasing coverage through the market are required to make application to the CMS for 1115 Medicaid waiver or SPA (State Plan Amendments). Under a SPA private plan, enrollment is optional but for states that opt for waivers, eligible beneficiaries are required. Premium Assistance State, such as Iowa, Pennsylvania, Michigan and Arkansas, bypassed the ACA’s expansion pathway and chose to pursue alternative models (Crawford and McMahon, 2014). Such States relied on the authority granted to them by the CMS (Center for Medicare& Medicaid Services).
In 2013, Iowa and Arkansas received their CMS approvals that allowed them to develop premium assistance programs that utilize Medicaid funding for purchasing private coverage for newly eligible beneficiaries of Medicaid (Crawford and McMahon, 2014). Premium assistance programs utilize both state and federal Medicaid funds for subsidizing private health insurance coverage costs. Over the years, some of the states that opted not to expand their Medicaid programs have expressed interest in adopting premium assistance programs with the aim of encouraging low-income families to participate in private coverage while preventing crowd-out, shoring up private coverage market and save costs by including employer constitutions to help with the payment of premiums.
Michigan sought waivers for expanding its Medicaid program while incorporating unconventional new features such as linking coast-sharing to healthy behaviors and making use of health savings-like accounts. The 1115 Michigan waiver is an alternative option for Medicaid expansion. The “Healthy Michigan” involves enrolling newly eligible adults in the state’s managed Medicaid care plans (Crawford and McMahon, 2014). Michigan’s amendment requires the beneficiaries to pay for their health expenses using health savings accounts.
The Healthy Michigan Plan seeks to cover about 400,000 residents of Michigan who are eligible for Medicaid. In regards to cost-sharing, Michigan’s plan involves establishing MI Health Accounts (health savings-like accounts) that allows the state and the beneficiaries to deposit their money (Crawford and McMahon, 2014). Healthy Michigan is designed in a manner that includes various essential health benefits of Obamacare.
The alternate models enable states to utilize federal funding for covering previously uninsured populations in the respective states and mitigate the political consequences associated with expanding the existing Medicaid programs (Crawford and McMahon, 2014). The common themes or features of the alternate models include relying on private insurance markets, emphasis on personal responsibility and healthy behaviors, and exemptions from the existing Medicaid rules pertaining to time limits, cost-sharing, benefits, and work requirements. The other features include contingencies or limits on Medicaid expansion.
Conclusion
Some Republican states took advantage of the 2012 Supreme Court’s ruling that allows them to opt out of Medicaid expansion under the Obamacare. Texas is among the states that have opted out of Medicaid expansion because of the state’s opposition to Obamacare. The Medicaid expansion brings a lot of federal money to the table, and such finances could have been used to insure millions of uninsured Texans. The states that rejected the expansion of medicated were motivated by their opposition to Obamacare. Medicaid is a government-sponsored healthcare program that benefits millions of poor Americans. Texas will not benefit from about $100 billion federal money because of its decision to reject the expansion proposals. Led by Republicans, Many Midwestern and Southern states rejected the Medicaid expansion.
References
Blumberg, J (2012). The Affordable Care Act: What does it do for low-income families? Retrieved from <http://www.irp.wisc.edu/publications/fastfocus/pdfs/FF15-2012.pdf.>
Buettgens, M., Holahan, J and Recht, Recht H. (2015). Medicaid expansion, health coverage, and spending: An update for the 21 states that have not expanded eligibility. Retrieved from <http://kff.org/medicaid/issue-brief/medicaid-expansion-health-coverage- and-spending-an-update-for-the-21-states-that-have-not-expanded-eligibility/.>
Crawford, M and McMahon, S (2014). Alternative Medicaid expansion models: Exploring state options. Retrieved from <http://www.nationaldisabilitynavigator.org/wp- content/uploads/resources-links/CHCS-Alternative_Medicaid_Expansion_Models.pdf.>
